Hertz goes electric, orders Tesla for $ 5.4 billion

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Hertz has ordered 100,000 electric vehicles from Tesla, one of the largest purchases of battery-powered cars in history and the latest proof of America’s growing commitment to EV technology.

Purchase by one of the world’s leading car rental companies reflects its belief that electric vehicles are increasingly accepted by environmentally conscious consumers as an alternative to vehicles powered by combustion engines internal oil-fired.

In an interview with The The Bharat Express News, Mark Fields, interim CEO of Hertz, said the Teslas were already arriving at company locations and should be available for rental from November.

Hertz said in its announcement that it will complete its purchases of Tesla Model 3 small cars by the end of 2022. It also said it will establish its own electric vehicle charging network as it strives to build the largest rental fleet of electric vehicles in North America.

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Mr. Fields wouldn’t say how much Hertz is spending on the order. But he said the company had sufficient capital and a healthy balance sheet after exiting bankruptcy protection in June.

The deal is probably worth around $ 4 billion (AU $ 5.4 billion) as each Model 3 has a base price of around $ 40,000. It also tops the list for single company electric vehicle orders.

In 2019, Amazon ordered 100,000 electric delivery vans from Rivian, a startup manufacturer of electric vans, utility vehicles and four-wheel drive vehicles. Amazon is an investor in Rivian.

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The Hertz order helped push the price of Tesla shares to an intraday high of US $ 997.57, before falling slightly on Monday afternoon.

In his interview with the TBEN, Fields made it clear his belief that electric vehicles were becoming more mainstream and that Hertz intended to be one of the major suppliers of electric vehicles to rental customers. He highlighted surveys showing that over the past five years, consumer interest in electric vehicles has increased dramatically.

Hertz will also invest in its own charging network.

Customers could also use Tesla’s large charging network for a fee, Fields said. The company has a network of around 25,000 chargers around the world.

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He declined to say how much Hertz will charge to lease the Teslas or whether they would be more expensive for customers than gasoline vehicles.

Daniel Ives, technology analyst at Wedbush Securities, wrote in a note to investors Monday (U.S. Time) that Hertz’s order represented a “major feather in the hat” for Tesla and showed wide adoption of electric vehicles was underway. “as part of this green tidal wave hitting the United States”.

China and Europe are ahead of the United States in vehicle electrification. But demand in the United States is accelerating.

-AAP