Interim Hertz CEO Mark Fields is amped up by the company’s big deal with Tesla.
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“We are excited about the Tesla relationship. It’s all wrapped around our strategy to lead the adoption of electric vehicles,” the former CEO of Ford said on Yahoo Finance Live. Fields is credited with planting the seeds for Ford’s EV pivot prior to his departure in 2017.
Hertz said in late October it had ordered 100,000 Tesla Model 3s, expected to be delivered late in 2022. The company is expected to rent out 50,000 of those cars to Uber to support its drive network. Tesla CEO Elon Musk then took to Twitter and said the contract hadn’t yet been signed.
But Fields told Yahoo Finance Live all systems are go with Tesla, and that Hertz did order 100,000 Teslas.
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Tesla CEO Elon Musk says he isn’t giving Hertz a discount on the reported $4.2 billion order. But he doesn’t need to because the House reconciliation spending bill includes a 30% tax credit for “qualified commercial electric vehicles.”
The text doesn’t clearly define what is a “qualified commercial electric” vehicle, but our sources say Hertz’s Teslas would likely make the cut. The credit could save Hertz $1.26 billion and make a Tesla almost as cheap for Hertz to buy as a Toyota Camry.
Hertz plans to install thousands of electric-vehicle chargers, which could also be eligible for taxpayers subsidies. The House spending bill extends a 30% tax credit for the installation of EV charging stations through 2031, which is on top of the $7.5 billion appropriation for stations in the separate Senate infrastructure bill.
Hertz Global Holdings Inc., fresh off a blockbuster order for 100,000 Teslas, reached an exclusive agreement to supply Uber drivers with electric vehicles and signed up Carvana Co. to dispose of rental cars it no longer wants.
Taken together, the deals represent a trifecta of aggressive and innovative initiatives with the potential to upend the car-rental business and hasten the transition to greener fuel sources. The car order on Monday, the largest-ever for EVs at $4.2 billion, was such as watershed moment that it propelled Tesla Inc.’s valuation past $1 trillion.
Under the agreement with Uber Technologies Inc., drivers for the ride-hailing giant who previously had to provide and maintain their own EVs will be able to rent one of 50,000 Teslas from Hertz instead. The program, which starts Nov. 1, is an alternative to buying or leasing, and many drivers may find it more appealing.
Uber drivers can rent a Tesla through Hertz starting on Nov. 1 in Los Angeles, San Francisco, San Diego and Washington DC, with the program later this year expanding to cities nationwide, the ride-hail company said in a blog post.
The Tesla rentals, consisting mostly of the electric vehicle company’s Model 3 sedan, will be available exclusively to Uber drivers and start out at $334 a week, including insurance and maintenance. Uber said the rental cost would drop to $299 per week or lower as the program expands in the coming year.
Elsewhere » Car & Driver / The Verge / Axios
Hertz is also investing in EV charging infrastructure, saying they will install thousands of chargers.
Beginning in November and expanding through year end, customers will be able to rent a Tesla Model 3 at Hertz airport and neighbourhood locations in U.S. major markets and select cities in Europe.
The cars will be delivered over the next 14 months, and Tesla Inc.‘s Model 3 sedans will be available to rent at Hertz locations in major U.S. markets and parts of Europe starting in early November, the rental company said in a statement. Customers will have access to Tesla’s network of superchargers, and Hertz is also building its own charging infrastructure.
It’s the single-largest purchase ever for electric vehicles, or EVs, and represents about US$4.2 billion of revenue for Tesla, according to people familiar with the matter who declined to be identified because the information is private. While car-rental companies typically demand big discounts from automakers, the size of the order implies that Hertz is paying close to list prices.
“How do we democratize access to electric vehicles? That’s a very important part of our strategy,” Mark Fields, who joined Hertz as interim chief executive officer on Oct. 6, said in an interview. “Tesla is the only manufacturer that can produce EVs at scale.”
Elsewhere » Wall Street Journal 🔒 / Financial Times 🔒/
Update » 2021.11.02 » Tesla Inc’s Elon Musk said the company had not signed a contract with Hertz » Reuters