Hertz (NASDAQ: HTZ) reported an earnings beat today that its electric vehicle (EV) fleet adoption and expansion partially contributed to. The rental agency has taken on a widespread EV adoption strategy to help alleviate costs and maintenance within its rental fleet.
Hertz beat consensus estimates of 21 cents by reporting an EPS of 39 cents per share. Additionally, it reported $2.05 billion, while analysts expected $2.033 billion.
It also increased the size of its EV fleet, its CEO Stephen Scherr said. “At the end of Q1, we had about 50,000 electric vehicles in our fleet, comprising approximately 10% of total cars,” Scherr said during the call.
During the quarter, General Motors and “other OEM EVs” entered the fleet, “providing more options for our customers to experience EV models at various price points.”
Hertz initially offered Tesla and Polestar EVs, ordering 100,000 units from Tesla at the end of 2021 and 65,000 from Polestar. Hertz made plans to buy 175,000 EVs from GM in September 2022.
One of the strategies that has spread across the EV sector this year is price cuts, which has contributed to the company’s expansion in the fleet. During the call, Hertz executives were asked whether the price cuts had made the company want to lean more on EVs. Scherr said it was an “encouraging proposition,” and the varied price points have given customers more options as well (via Seeking Alpha):
“I’m obviously a happier and a better buyer at a lower price point than not. And I’m equally pleased that the prospect that while I continue to buy Tesla’s and Polestar’s, are now taking delivery of the GM EVs, which will be at varied price points and offer our customers greater choice.”
The EVs have been offered to customers at more attractive rates thanks to the price cuts, which has been an encouraging portion of the business and may push customers to try driving an electric car instead of a gas-powered one.
Rental volumes to rideshare drivers have increased in both its ICE and EV sectors, the company detailed.
Disclosure: Joey Klender is a TSLA Shareholder.
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