Hertz has unveiled a new strategy to rapidly offload its Tesla rental cars in an effort to mitigate financial losses. This move follows the company’s realization of the challenges associated with maintaining a large inventory of electric vehicles.
The initial announcement of Hertz purchasing 100,000 electric cars from Tesla significantly boosted Tesla’s market capitalization to $1 trillion. However, Hertz encountered difficulties as Tesla’s frequent price cuts accelerated the depreciation of its fleet, impacting Hertz’s financial health.
The electric vehicle deal, initially hailed as historic, resulted in the departure of former CEO Stephen Scherr. In the first quarter of 2024, Hertz reported an increase in depreciation costs exceeding half a billion dollars.
Hertz initially aimed to sell Teslas for as low as $20,000, but this measure proved insufficient to curb the financial losses. Consequently, the company has decided to add tens of thousands of Teslas to its sales list, aiming to reduce monthly per-unit depreciation from $600 in Q2 2025 to $300.
The company intends to complete the sale of its Tesla fleet by the end of 2025.
