Rental company Hertz Global Holdings Inc. said Thursday it will sell about 20,000 electric vehicles from its U.S. fleet in favor of gasoline-powered vehicles, citing rising costs related to crashes and damage.
Shares in the company, which operates vehicles such as Elon Musk's Tesla and Swedish electric car maker Polestar, were down about 3% at market open.
Hertz announced that it would order 100,000 Teslas by the end of 2022, and then decided to purchase up to 65,000 Teslas from Polestar over five years.
“Costs related to crashes and injuries, primarily related to EVs, continued to be high during the quarter…” Hertz said in a regulatory filing Thursday.
The company previously set a goal of electrifying 25% of its fleet by the end of 2024.
Hertz expects the proposed sale to result in approximately $245 million in increased depreciation and amortization expense in the fourth quarter of 2023, warning of a hit to the company's adjusted core earnings over the same period.
The company said it will continue to focus on improving the profitability of its remaining EV vehicles.
heart's Used car site has over 700 EVs listed for sale, including BMW's i3, Chevrolet's Bolt, and Tesla's Model 3 and Model Y SUVs.
