Hertz sells Tesla’s fleet amid the slowing EV market

Hertz Global Holdings has put 20,000 electric vehicles from its global fleet, including nearly a third of its existing EV inventory, up for sale. This move, starting in January, marks a shift in Hertz’s EV strategy, which initially aimed to incorporate hundreds of thousands of Teslas, Polestars, and GM electric models into its rental fleet. This decision reflects a broader trend in the U.S. auto industry, where the anticipated rapid transition to electric vehicles (EVs) has slowed, despite significant growth in EV sales over the past few years.

While EV sales in the U.S. more than quadrupled from 2020 to 2023, accounting for over 9% of total light-duty vehicle sales, the growth pace has decelerated. Automakers are now focusing more on hybrid models. However, the transition to EVs remains inevitable due to falling sticker prices, improved battery technology, and expanded charging infrastructure. This shift is also driven by the need to reduce carbon emissions from cars and trucks.

Hertz’s decision to sell its EVs offers a unique opportunity for consumers to purchase used Teslas at competitive prices through its Hertz Car Sales division, which has been operational since 1977 and has about 70 locations across the U.S. According to a Hertz spokesperson, these EVs are available nationwide in major metropolitan areas, averaging around $25,000. Each vehicle undergoes a 115-point inspection and includes a 12-month/12,000-mile limited powertrain warranty, with additional vehicle protection plans available.

However, potential buyers should consider that these vehicles, despite being only a couple of years old, have been heavily rented and may have higher mileage and wear and tear compared to other used vehicles. Interested buyers can consult various online sources and take virtual test drives, but an in-person test drive and third-party inspection are recommended.

The Hertz Car Sales website currently lists 1,475 “Hertz Certified” used EVs, including 1,186 Teslas. These vehicles have seen significant price drops due to broader market trends. A March study by automotive research firm iSeeCars found that used EV prices had plummeted 31.8% over the past year, with used Tesla prices dropping 28.9%, driven largely by Elon Musk’s aggressive price cuts on new Teslas.

In April, iSeeCars reported that Tesla’s models are among the fastest-selling used EVs, with an average price of $37,644, making them $20,000 cheaper than the fastest-selling new EVs. This price disparity highlights the value proposition of used EVs, particularly for budget-conscious consumers.

Hertz’s inventory primarily includes 2022 and 2023 Tesla Model 3 sedans, priced between $21,000 and $36,000. Hertz also offers a Rent2Buy program, allowing customers to rent a vehicle for up to three days or take a complimentary two-hour test drive before purchasing. All rental charges are waived if the car is purchased.

Consumers can also explore other avenues for purchasing used Teslas, such as Tesla’s official website, which lists more used vehicles than Hertz, or online marketplaces like CarMax and Carvana. These platforms offer a range of prices and models, providing buyers with multiple options to compare.

Nevertheless, Hertz’s strategy to sell its Tesla fleet amid a slowing EV market represents a significant shift in the industry’s electrification journey. While the transition to EVs continues, the current landscape offers a unique opportunity for consumers to purchase affordable, high-quality used electric vehicles.