© Reuters. FILE PHOTO: Signage is seen at Hertz rental car at John F. Kennedy International Airport in Queens, New York City, U.S., March 30, 2022. REUTERS/Andrew Kelly
(In the September 20 story, Hertz adjusted her estimate in the final paragraph to 1.8 million tons from 3.5 million)
By David Shepardson and Joseph White
(Reuters) – Car rental company Hertz Global Holdings (OTC:) plans to order 175,000 electric vehicles from General Motors Co (NYSE:) over the next five years, its latest move on models zero-emission vehicle.
Steve Carlisle, the automaker’s director of North American operations, said during a conference call the multibillion-dollar deal could be the first of many. GM’s agreement to supply electric vehicles to rental car companies.
“It’s a huge start,” Carlisle said, adding that GM is negotiating similar contracts with other rental car companies.
GM shares fell more than 5% Tuesday afternoon following a warning by rival Ford Motor (NYSE:Co) late Monday that supply chain costs were $1 billion higher than expected in the fourth quarter. father. Ford shares fell more than 11%.
Automakers have cut their reliance on low margins, selling in bulk to rental car dealers as supply chain issues have limited production. Carlisle said GM expects to deliver electric vehicles to Hertz at a retail profit margin.
GM CEO Mary Barra said in a statement “each rental experience adds more purchase consideration to our products and drives growth for our company.”
GM aims to have a production capacity of 1 million electric vehicles per year in North America by 2025. Carlisle says sales for Hertz are in line with its previously announced target.
Such deals would ease pressure on GM to hit its electric vehicle sales target through individual customer sales, a market led by Tesla (NASDAQ: Inc.) dominate.
Hertz’s current goal is for a quarter of its fleet to have electricity by the end of 2024. In April, Hertz said it would buy up to 65,000 electric vehicles over five years from electric vehicle maker Polestar, a joint venture. joint venture between Geely of China and Sweden. Volvo unit. In October 2021, Hertz announced plans to buy 100,000 Tesla electric vehicles, mostly Model 3s.
GM’s deal “spans a wide range of vehicles and price points – from small and midsize SUVs to pickups and luxury vehicles,” the companies said.
Carlisle said GM’s first electric vehicles to arrive at Hertz will be the Chevrolet Bolt starting early next year.
GM expects Hertz to deploy more electric vehicles in Los Angeles and San Francisco, helping to meet California’s electric vehicle quota. Hertz senior vice president, Jeff Nieman said the company plans to offer electric vehicles throughout its network, with priority given to Los Angeles, San Francisco, Miami and Orlando.
Hertz estimates customers can travel more than 8 billion miles with these EVs and save about 1.8 million tons of carbon dioxide equivalent emissions compared to gasoline-powered vehicles.