Hertz selling off Teslas citing high repair costs and frequent damage

[liggy]

Hertz Is Selling Its Fleet Of Rental Tesla Model 3s For Cheap

After going all-in on a fleet of rental EVs, Hertz cites high repair costs and frequent damage for its purge of these desirable EVs

jalopnik.com

Not interested in driving a Tesla ay any price but interesting data point...

 

[joec]

Note, it's not the cost to repair the cars. It's the downtime when waiting for repairs. Which is super expensive for Hertz, but not the same thing. These sorts of headlines irk me, because they give ICE owners the impression that EVs are expensive to maintain. Which is nonsense.

Before my Air, my Model 3 was the least expensive car I had ever owned to maintain. I replaced washer fluid and paid for replacement tires. And that was it.

Having said all that I wouldn't take a Model 3 from Hertz if you paid me to take it. I've had the misfortune of renting more than one of those in the past year, and they were all beaten to death. Cars with barely 15k miles on them drove like they had 100k. Rattles everywhere. Plastic trim (Tesla folks like to call it "chrome delete" but it's just black plastic) that's chipping off. And on and on. I get the impression people rent these things to beat the hell out of them. And they aren't particularly rugged cars to begin with.

 

[liggy]

Note, it's not the cost to repair the cars. It's the downtime when waiting for repairs. Which is super expensive for Hertz, but not the same thing. These sorts of headlines irk me, because they give ICE owners the impression that EVs are expensive to maintain. Which is nonsense.

Before my Air, my Model 3 was the least expensive car I had ever owned to maintain. I replaced washer fluid and paid for replacement tires. And that was it.

Having said all that I wouldn't take a Model 3 from Hertz if you paid me to take it. I've had the misfortune of renting more than one of those in the past year, and they were all beaten to death. Cars with barely 15k miles on them drove like they had 100k. Rattles everywhere. Plastic trim (Tesla folks like to call it "chrome delete" but it's just black plastic) that's chipping off. And on and on. I get the impression people rent these things to beat the hell out of them. And they aren't particularly rugged cars to begin with.

hehe... drive it like you stole it is the rule for rental cars, eh?

And nope - no interest in buying a rental - well maybe a GT350H would be the exception.

I was under the impression that body repairs on Teslas are particularly spendy too. I bet you're spot on re: downtime.
That has got to be a huge detriment to the value of a Tesla as part of the fleet.

 

[liggy]

More background info from a CNN story:

“[C]ollision and damage repairs on an EV can often run about twice that associated with a comparable combustion engine vehicle,” Hertz CEO Stephen Scherr said in a recent analyst call

For rental car companies like Hertz, which sell lots of vehicles in the used car market, depreciation has a big impact on their business, and is a major factor when deciding which cars to have in their fleets

“The MSRP declines in EVs over the course of 2023, driven primarily by Tesla, have driven the fair market value of our EVs lower as compared to last year, such that a salvage creates a larger loss and, therefore, greater burden,” Scherr said.

Besides costing more to repair when they’re damaged in a crash, Scherr also said, EVs are also getting in more crashes. Again, Teslas, which make up 80% of Hertz’s EV rental fleet, are mostly the problem in both these areas, he has said.

"Chrome Delete".

 

[joec]

I wonder if a lot of people are renting these things to try out Autopilot. And they have no idea how it works. So yeah, I could see crashes resulting from not reading carefully about what it can and can't do.

 

[joec]

Basically, Hertz made a terrible investment in Tesla at the absolute worst time (just before they started slashing prices), gave their staff and customers little support in how to use an EV properly. And now the CEO wants to blame it all on EVs in general. Sounds about right.

 

[Steveinarizona]

Basically, Hertz made a terrible investment in Tesla at the absolute worst time (just before they started slashing prices), gave their staff and customers little support in how to use an EV properly. And now the CEO wants to blame it all on EVs in general. Sounds about right.

Yep. Scottsdale is a winter destination for golf and I meet folks from all over the country at the golf courses. They are driving rentals and sometimes I meet one who owns an ICE car and was given an EV without training. They had no idea how to drive it nor realize its features. I suspect that Hertz has turned a lot of potential EV buyers into skeptics as a result.

 

[EXOTIC2]

Note, it's not the cost to repair the cars. It's the downtime when waiting for repairs. Which is super expensive for Hertz, but not the same thing. These sorts of headlines irk me, because they give ICE owners the impression that EVs are expensive to maintain. Which is nonsense.

Before my Air, my Model 3 was the least expensive car I had ever owned to maintain. I replaced washer fluid and paid for replacement tires. And that was it.

Having said all that I wouldn't take a Model 3 from Hertz if you paid me to take it. I've had the misfortune of renting more than one of those in the past year, and they were all beaten to death. Cars with barely 15k miles on them drove like they had 100k. Rattles everywhere. Plastic trim (Tesla folks like to call it "chrome delete" but it's just black plastic) that's chipping off. And on and on. I get the impression people rent these things to beat the hell out of them. And they aren't particularly rugged cars to begin with.

Spot on great analysis, and this is the real take away despite what some of the media outlets try to portray again ev’s.

 

[DeaneG]

Some analysis from Alex on Autos:
"Yep, Hertz is selling 20,000 of their EVs. But "why" this is happening isn't as cut and dry as many headlines indicate. The two main factors for the reduction are: Hertz's ride sharing rental (Uber/Lyft) issues and associated repair costs, AND repair costs on regular consumer rentals and some amount of customer demand. Let's unpack one at a time.
The rideshare rental market is a big factor. Basically Hertz bought a bunch of Teslas in 2021 and 2022 and rented them to people driving for Uber and Lyft. As it turns out, Uber and Lyft drivers aren't the most careful folks out there especially when driving a car they don't own and they got damaged at a shockingly high rate.
Let's unpack that further. Hertz bought some $50,000-$60,000 luxury cars (Model 3 /Y were more expensive in 2021) that went 0-60 in 4.2-4.5 seconds and then got surprised by the high repair costs and higher damage rates. Putting this in perspective, that's like handing your friendly local Taxi driver the keys to a BMW M340i with full damage waivers and getting surprised when it gets wrapped around a telephone pole.
Fast forward to 2023/2024. Hertz realizes they "done screwed up" so they transfer these roughly treated Model 3/Ys to the regular rental fleet where *surprise* they aren't flying off the rental lots. (This is probably why the Model Y we rented recently was fu***d up). Now Hertz has decided to ditch around 1/3 of their EVs. And when we say EVs, we mean Teslas basically.
For some reason Hertz though the costs involved in renting 400+ horsepower EVs would be like renting a Dodge Dart. Lord knows why since renting a Hertz Shelby Mustang can't be the same as a Chevy Malibu.
Teslas may not offer "traditional luxury" virtues or features, but the reality is, they are a luxury car brand. The prices are comparable to the Germans luxury players, the cars are more or less size-segmented like the Germans, and importantly: insurance and repairs are more like a German luxury car than a Camry. This is lesson for someone shopping for a --luxury segment-- EV: Just because it's an EV doesn't mean *everything* about it will be cheaper. Charging and maintenance will generally be less than a gasoline car, but insurance and repairs will be substantially similar to an Audi, BMW or Mercedes. If you want more mainstream repair costs, get an EV from a volume car company like GM, Nissan, etc."

 

[joec]

Some analysis from Alex on Autos:
"Yep, Hertz is selling 20,000 of their EVs. But "why" this is happening isn't as cut and dry as many headlines indicate. The two main factors for the reduction are: Hertz's ride sharing rental (Uber/Lyft) issues and associated repair costs, AND repair costs on regular consumer rentals and some amount of customer demand. Let's unpack one at a time.
The rideshare rental market is a big factor. Basically Hertz bought a bunch of Teslas in 2021 and 2022 and rented them to people driving for Uber and Lyft. As it turns out, Uber and Lyft drivers aren't the most careful folks out there especially when driving a car they don't own and they got damaged at a shockingly high rate.
Let's unpack that further. Hertz bought some $50,000-$60,000 luxury cars (Model 3 /Y were more expensive in 2021) that went 0-60 in 4.2-4.5 seconds and then got surprised by the high repair costs and higher damage rates. Putting this in perspective, that's like handing your friendly local Taxi driver the keys to a BMW M340i with full damage waivers and getting surprised when it gets wrapped around a telephone pole.
Fast forward to 2023/2024. Hertz realizes they "done screwed up" so they transfer these roughly treated Model 3/Ys to the regular rental fleet where *surprise* they aren't flying off the rental lots. (This is probably why the Model Y we rented recently was fu***d up). Now Hertz has decided to ditch around 1/3 of their EVs. And when we say EVs, we mean Teslas basically.
For some reason Hertz though the costs involved in renting 400+ horsepower EVs would be like renting a Dodge Dart. Lord knows why since renting a Hertz Shelby Mustang can't be the same as a Chevy Malibu.
Teslas may not offer "traditional luxury" virtues or features, but the reality is, they are a luxury car brand. The prices are comparable to the Germans luxury players, the cars are more or less size-segmented like the Germans, and importantly: insurance and repairs are more like a German luxury car than a Camry. This is lesson for someone shopping for a --luxury segment-- EV: Just because it's an EV doesn't mean *everything* about it will be cheaper. Charging and maintenance will generally be less than a gasoline car, but insurance and repairs will be substantially similar to an Audi, BMW or Mercedes. If you want more mainstream repair costs, get an EV from a volume car company like GM, Nissan, etc."

Interesting analysis. The problem with his final conclusion, to "get an EV from a volume car company like GM, Nissan, etc." is that none of those brands offer cars that have range worth a damn. No one wants to rent a car that can't get them where they need to go.

I had enough trouble renting a short-range Model 3 one time. A Leaf or a Bolt would be fairly useless for anything but running a few errands within town.

It makes me wonder how Enterprise will do with the Lucids they've just added to their fleet. If they treat them as exotics (as I think they currently are) and charge appropriately for them, I think they will fare much better than Hertz did with their Teslas.

 

[hydbob]

Interesting analysis. The problem with his final conclusion, to "get an EV from a volume car company like GM, Nissan, etc." is that none of those brands offer cars that have range worth a damn. No one wants to rent a car that can't get them where they need to go.

I had enough trouble renting a short-range Model 3 one time. A Leaf or a Bolt would be fairly useless for anything but running a few errands within town.

It makes me wonder how Enterprise will do with the Lucids they've just added to their fleet. If they treat them as exotics (as I think they currently are) and charge appropriately for them, I think they will fare much better than Hertz did with their Teslas.

A bolt for in town driving with 243 EPA range is plenty no?

 

[xponents]

A bolt for in town driving with 243 EPA range is plenty no?

I doubt many who take rental cars do it for town stuff… our dodge charger rental in Puerto Rico got 400 miles of use in one day, for example.