Hertz Global Holdings Inc. agreed to purchase 65,000 electric vehicles over five years from the Swedish auto maker Polestar.
The rental-car industry,
a consistent purchaser of new models in the car business, is increasing efforts to add more battery-powered vehicles to fleets.
The addition of EVs enables rental-car companies to show their embrace of greener technologies and cut their greenhouse-gas emissions, but it comes with \ twist. Electric vehicles are typically more expensive, creating higher upfront costs for rental-car companies and potentially raising prices for renters.
Stephen Scherr, Hertz’s CEO, said higher gas prices are pushing some rental customers into electric models. He added that nearly half of the EVs offered in Hertz’s lineup have enough battery range that drivers don’t need to charge them during their reservation.
*Chart on car rental market projection
Polestar, owned by Chinese car maker Zhejiang Geely Holding Group Co., focuses on high-performance electric cars.
Last year, Hertz placed a 100,000-vehicle order from electric-car pioneer Tesla.
At the time, Hertz said the order would increase its mix of electric cars to 20% of its overall fleet.
The rental-car company has undergone a reorganization since it filed for bankruptcy
However, in May 2020 after the falling value of its used-car fleet caused a debt crunch. It became a meme stock, cheered on by an army of individual traders, and business rebounded faster than expected as the pandemic reshaped Americans’ habits.
Demand for rental cars heated up during the pandemic as many consumers avoided planes and public transportation and relocated for remote work.
Hertz went public again in November and has a market value of about $9 billion, three times what it was before the pandemic hit.