Why Rental Car Companies Are Ditching Electric Vehicles for Gas Cars

Why Rental Car Companies Are Ditching Electric Vehicles for Gas Cars

Call it a rental car reversal Herz is going back to gas the company is selling off about 20,000 of its electric vehicles to buy gas powered cars instead why the cost of repairs from collisions and damages is hurting the company’s bottom line this a depreciation also a

Problem Herz says price Cuts in the new car market driven primarily by Tesla are pushing down the resale value of the EVS but while Herz is cutting back the White House is speeding right ahead doubling down yesterday they announced more than $600 million in funding for new EV

Charging stations across the country so the question now is are Americans all in or kind of worn out on electric vehicles joining us now to break through let’s see Lauren fix Is With Us automotive expert and founder of the car coach Lauren another reason by the way that

Herz mentioned is there’s just a lack of demand when people are sitting on there clicking and I just booked in New Hampshire and Iowa I did not even think to book an EV I mean have they plateaued in a way well for rental cars for sure uh you

Know chance I was just recently in Jacksonville and I went to get my regular rental car like you I just booked a midsize SUV and of course they’re like oh do you want to swap over to an electric vehicle and I’m thinking no because I have to bring it back with

A full charge like you would have to bring it back with a full tank of gas and I don’t plan on spending my vacation sitting at a charging station for an hour or hoping there’s a charging station that functions and that’s part of the problems consumers are finding

With these electric cars it’s it’s not the vehicles they’re producing because they are producing some pretty impressive Vehicles like we saw at the consumer electronic show what we’re seeing is consumers frustrated with the charging infrastructure and then of course the cost of increased on insurance and then maintenance and

That’s one of the things that hurts found boy these tires are wearing out a lot quicker than they planned really okay I hadn’t seen that I’m so glad you’re here you know and that reminds me of that report that one of the cabinet secretaries for President Biden she

Planned this you know cross country prev Venture in an EV and it turned out like they would show up somewhere there weren’t stations you know some of them took forever you don’t have the the account that you needed it was a whole big giant mess but then I wonder about

Familiarity because in a car you kind of you want to have a general idea of how it works and then there’s the range anxiety will it get me to where I need to go a lot of us still don’t trust that the juice is really going to be there

And they will understand the charging system how do they overcome that well I I think people have gone beyond the range anxiety because there’s cars like the loose air which will go 500 mil on a charge it’s charging anxiety and I went through the same

Thing in La I I picked up an SUV that was an electric vehicle and I got to the charging station that said hey you just go to one of these charging stations I got there there were three stations one wasn’t working two were filled someone had parked their car and took off so

Whether they went home they went to the mall whatever it was they weren’t there so their cars were fully charged but I can’t plug in and this is the frustration it would be like someone leaving their gas pump in the in the car and then taking off and you would never

Do do that because you can fill up a gas tank in 7 minutes now there are some upcoming Solutions such as hydrogen BMW is working that Hyundai’s working on it and a couple other brands and then that’s great those are potential solutions that will fill up a charging

In four minutes however that’s going to require not just infrastructure which we don’t have but it’s also going to require adaptation to the existing cars which may not be available so I think that consumers are waking up to some of the issues that are out there as far as

The technology of these vehicles and how they they many of them work very similar to what you’re used to if you’re driving an F-150 and you look at a lightning truck you’ll get in and go wow that works just like my regular truck except instead of adding fuel whether it be

Diesel or gas you’re plugging it in so some people are charging at home again you’ve got an older home which a lot of people do something that’s you know 50s or older or even into the 70s you have to update your electrical equipment and that includes the Box because otherwise

You could potentially cause a fire and a certified electrician has to put it in and those costs are on you well that doesn’t sound overwhelming at all Lauren F so I mean given everything you just told me have they oversold us a bit on how quick and easy all this is going to

Be I think the overselling is the government mandates I think consumers want to have a choice if you live in the city and you drive only you know back and forth to work and it’s five miles each we an electric car is perfect perfect for running around town taking

Your kids to school whatever that might be but if where I live in Buffalo New York we have a blizzard coming the last thing you want to be is an electric car in a blizzard because the resistance of the snow using the heater using the defroster using your charger for your

Phone all these things draw down on the battery different than that of gasoline so people are considering you know maybe this doesn’t work and in this area electric vehicles are just not selling people that have them it’s their second or third car now if you want to do that

That’s also an option but not everybody can afford two and three vehicles so I I think that they’re starting to realize that they’re kind of saturated already with those early adapters those people that love the tech and for the average person maybe it’s not a good fit and

Again also the average cost of an electric vehicle is $66,000 where the average cost of a gasoline powered vehicle is under $50,000 so you start looking at those differences and you go you know maybe not this time so people are looking at hybrids which gives you the best of both

Worlds plug it in electric when you need it gasoline when you’re on the road maybe a long trip or you’re going a lot of places or the weather’s terrible so I I think you’re going to start seeing a larger push toward that the federal government doesn’t want that they want

Everybody on electric and the grid can absolutely not support everyone being on the grid wow and I looked it up by 2035 nine states have already said you cannot buy a gas powered car in that state or District by 2035 after that so I mean that’s according to CNN Money okay

Lauren fix I want to talk to you again I don’t think I’m not a car person but I want to talk to you again in the future thank you good luck with the blizzard thank you

Rental-car company is the latest to be hit by weak demand for electric cars. Hertz Global Holdings Inc. said Thursday it is selling about 20,000 electric vehicles from its fleet, or about one-third of the total, in the latest sign that the EV revolution is stalling amid weak demand from consumers.

The move is aimed at better balancing supply and expected demand for EVs, allowing the car-rental company to scrap a disproportionate number of lower-margin rentals and reduce damage expenses associated with EVs.

Collision and damage costs for EVs remained high in the fourth quarter, Hertz said in a regulatory filing. That’s because EVs require special tools and parts and specialist knowledge to repair after a crash, more so than traditional gas-powered vehicles.

The charge is on top of the depreciation costs the company expects to record in the quarter in the ordinary course of managing its fleet.

Hertz will continue to offer EVs but will implement measures to boost profitability, including by expanding infrastructure such as charging stations and expanding relationships with EV makers, particularly as it relates to more affordable access to parts and labor, the company said.

Hertz will reinvest in additional internal-combustion-engine vehicles and expects to improve profits or earnings before interest, taxes, depreciation and amortization, across 2024, as vehicles are rotated.

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