Hertz’s order for Teslas is among the largest EV purchases ever — the Boston Herald

By TOM KRISHER

DETROIT (AP) -Hertz announced Monday that it will buy 100,000 electric cars from Tesla, one of the largest purchases of battery-powered cars in history and the latest proof of the country’s growing commitment to EV technology.

The acquisition of one of the world’s leading car rental companies reflects its confidence that electric cars are gaining acceptance among environmentally friendly consumers as an alternative to vehicles powered by oil-burning internal combustion engines.

In an interview with The Associated Press, Mark Fields, Hertz’s interim CEO, said Teslas is already arriving at the company’s sites and should be available for rental from November.

Hertz said in its announcement that it will complete its purchases of Tesla Model 3 small cars by the end of 2022. It also said it will establish its own charging network for electric cars as it strives to produce the largest rental fleet of electric cars in North America.

Fields would not say how much Hertz is spending on the order. But he said the company has sufficient capital and a healthy balance sheet after coming out of bankruptcy protection in June.

The deal is probably worth about $ 4 billion because each Model 3 has a base price of about $ 40,000. It also ranks at the top of the list of electric vehicle orders from a single company. In 2019, Amazon ordered 100,000 electric vans from Rivian, a startup manufacturer of electric vans, pickups and SUVs. Amazon is an investor in Rivian.

The Hertz order helped send the price of Tesla shares, which jumped more than 8% at the start of trading on Monday, to an intraday record of $ 997.57, before retreating slightly on Monday afternoon.

In his interview with the AP, Fields clarified his belief that electric vehicles are increasingly moving into the mainstream and that Hertz intends to be a leading supplier of electric cars to rental customers. He pointed to studies that showed that consumer interest in electric cars has grown dramatically over the past five years.

“More are willing to try to buy,” he said. “It’s pretty amazing.”

Fields said Hertz, based in Estero, Florida, is also in discussions with other automakers about buying additional electric cars as it expands its EV fleet as more models enter the market.

Hertz is also investing in its own charging network. Fields said it plans to have 3,000 chargers at 65 locations in the U.S. by the end of 2022 and 4,000 by the end of 2023. Many of the sites will be on Hertz sites, e.g. Airports, he said, while others will be in suburban areas.

Customers would also be able to use Tesla’s own large charging network for a fee, Fields said. The company has a network of about 25,000 chargers worldwide.

Fields declined to say how much Hertz would charge to rent Teslas, or whether they would be more expensive for customers than gas-powered vehicles.

Daniel Ives, a technology analyst at Wedbush Securities, wrote in a note to investors on Monday that Hertz’s order represents a “big feather in the cap” for Tesla and shows that a broad introduction of electric vehicles is underway “as part of this upcoming green tidal wave hitting the US ”

China and Europe have been ahead of the United States in electrifying vehicles. But demand in the United States is accelerating, Ives noted, with Tesla at the helm, followed by startups Lucid Motors, General Motors, Ford and others chasing a potential $ 5 trillion market opportunity over the next decade.

Hertz Global Holdings Inc. requested bankruptcy protection in May 2020, two months after the coronavirus broke out across the country. It was among the first large companies to be trapped by the pandemic as infections increased and closed travel on a global scale for both companies and holidaymakers.

In October, Hertz appointed Fields, a former Ford Motor Co. CEO, as its interim CEO.

Shortly after Hertz’s announcement Monday, the National Transportation Safety Board released a letter from its chairman reprimanding Tesla for failing to respond to recommendations coming from several fatal accident investigations involving the company’s Autopilot partially automated driver assistance system. The agency recommended four years ago that Tesla limit where its Autopilot system can operate and that it better monitor drivers to make sure they are alert.