Rental firm Hertz Global Holdings (HTZ.O) said on Thursday it would sell about 20,000 electric vehicles, including Teslas, from its U.S. fleet due to higher expenses related to collision and damage, and will opt for gas-powered vehicles.
Shares of the company, which also operates vehicles from Swedish EV maker Polestar among others, fell about 4%. Tesla’s (TSLA.O) stock was down about 3%.
Hertz also expects to book an about $245 million charge related to depreciation expenses from the proposed EV sale in the fourth quarter of 2023.
Hertz’s decision underscores the bumpy road EVs have hit as the growth rate on sales of those vehicles has slowed, causing carmakers like General Motors (GM.N) and Ford (F.N) to scale back production plans of those vehicles.
Morgan Stanley analyst Adam Jonas in a note said the car rental firm’s move was a warning across the EV space and it was another sign that EV expectations need to be “reset downward across the market.”
“While consumers enjoy the driving experience and fuel savings (per mile) of an EV, there are other ‘hidden’ costs to EV ownership,” Jonas added.
For example, the 2023 GMC Hummer EV, a full-size pickup, weighs more than 9,000 pounds, sporting a 2,900-pound battery. In comparison, the 2023 GMC Sierra, also a full-size pickup, weighs less than 6,000 pounds, according to Kelley Blue Book.
Traffic safety is particularly concerning. In crashes, the “baseline fatality probability” increases 47% for every 1,000 additional pounds in the vehicle — and the fatality risk is even higher if the striking vehicle is a light truck (SUV, pickup truck, or minivan), according to a 2011 study published by the National Bureau of Economic Research.
Sure, let’s act like Full Sized pickup is a meaningful term. They compared the Hummer EV to the smallest line of Sierra trucks, the 1500.
The Sierra 3500, also a full sized pickup tops out at 8300 pounds. The Cybertruck tops out at 6843 pounds, so I guess I could use that to say that EVs are lighter than ICE vehicles.
The F150 to F150 Lightning is probably the best comparison, and it shows the lightning to be about 17% heavier.
