A Tesla Model 3 electric vehicle at the location of Hertz Airport.
Photo by ER Davidson
Soon Hertz Global Holdings It was reorganized after breaking out of bankruptcy last summer and the Covid-19 pandemic stalled the entire car rental industry.Estero, Florida-based company boldly Announced $ 4.2 Billion Transaction Purchase 100,000 Tesla fully electric vehicles (EVs) by the end of 2022. As such, competition for the transition from internal combustion engine (ICE) models to EVs continued within the industry.
While Hertz first left the starting blocks, with its two biggest rivals, Enterprise Holdings. Avis Budget GroupBut just as it will take years for EVs to be fully adopted by American drivers, car rental shifts will be marathons rather than sprints. “Companies operating fleets on our scale will not be able to turn on dimes and move to EVs all next year,” said Sharkey Laguna, chairman of the American Car Rental Association. “Our industry wants to move as fast as possible, but there are some serious and challenging constraints.”
For the first, Laguna said, “I’m just getting something damn.”
The $ 56 billion US rental industry typically buys about one-tenth of new car makers every year, due to continued supply chain disruptions and a lack of particularly important computer chips. , The number has decreased significantly. According to Laguna, the industry bought 2.1 million cars from OEMs in 2019, compared to about 750,000 in 2021. US EV sales doubled in 2021, but still account for only about 4% of the total automotive and truck market.
Another major speed increase for car rental companies is the lack of airports and other rental locations, hotels, resorts, office buildings, and EV charging stations along local and interstate highways. And the challenge is to educate and train corporate agents and mechanics on EVs, not to mention being familiar with drivers about the differences from operating ICE vehicles.
Hearts does not state the total number of vehicles in its fleet, said Jeff Niemann, Senior Vice President of Operations Initiative. 65,000 Polestar 2s — an EV brand co-owned by Volvo and its Chinese parent Gheely, to be unveiled through a SPAC contract — Hertz 5 year contract Announced in April. Niemann, however, said he was convinced that EVs would “occupy more than 30% of our fleet by the end of 2024.”
Meanwhile, Deutsche Bank analyst Chris Waronka said Hearts has hundreds of thousands of ICE models in the United States and will be rented for the next few years. Still, “they decided to carry an EV torch for the industry and talk very openly about their plans and goals,” he said.
There are plenty of Hertz TV spots aired at this year’s Super Bowl, where NFL superstar Tom Brady is promoting Tesla rentals. Hertz has also created a dedicated area on its website to help educate drivers about EVs.
According to Waronka, Hearts’ main target is the corporate market. “Leisure customers may find it cool to drive an electric car, but longer games are on the corporate side,” he said.
In addition to comparing the costs of employees driving EVs and ICE vehicles, companies see EVs as a quantifiable way to reduce greenhouse gas (GHG) emissions and reach net-zero goals. I am. Improve the authenticity of the environment, society and governance (ESG) among sustainability investors and advocacy groups.
“Original research shows that corporate accounts are willing to pay a surcharge for EVs, to help achieve some of the ESG’s objectives,” said Woronka. ..
Not surprisingly, the rental companies themselves have adopted this concept, said Saraforni, director of clean cars for the non-profit corporate electric vehicle alliance (CEVA). They did say, “I want to get more bats with EV seats,” but “they also want to reach their sustainability goals and greenhouse gas emission reduction goals,” she said. Said.
Siemens US, a German-based conglomerate affiliate, was a member of CEVA’s flagship and was part of the Hertz EV program launched last fall. Randall Achterberg, Travel Products Manager in North America, said: A GHG produced by the US fleet of approximately 10,000 Siemens vehicles. “In terms of corporate travel, we want to expand the use of EVs by our employees.”
To date, Siemens has booked over 100 EV rentals at Hearts. “We’re not pushing as hard as we want because we’re not ready,” Achterberg said, acknowledging the inherent obstacles to EV deployment. Siemens mitigates one obstacle. We have built an EV charging station and promise to build 1 million charging stations in the United States over the next three years.
Enterprise may not be as frontlined as Hertz in EV rental programs, but a privately held company headquartered in St. Louis has been in the exploration phase since 2014.It’s the year it started to participate Drive Electric Orlando Rental PilotA multi-year study sponsored by the Electrification Coalition, a Washington, DC-based non-profit organization advocating the adoption of EVs, especially among fleet owners.
The pilot was partially funded by the US Department of Energy and consisted of resorts and theme parks in the region, centered around Orlando International Airport. Chris Huffenrefer, Vice President of Innovation, Enterprise, said: The company rented all-electric vehicles such as the Chevrolet Bolt and Nissan Leaf to travelers who were given incentives for benefits such as free charging, parking and valley services.
“EV is [then] After thinking about it in our business, it is in line with today’s lessons. ” In other words, as with alliances with other entities, putting employees on the steering wheel of an EV is important “to enable them to actively communicate with their customers.” Invest in the charging infrastructure.
The rental company says it is building its own charging station, but another important partner is the US government. Last year’s bipartisan infrastructure bill allocated $ 7.5 billion to the state to build a network of EV charging stations. Earlier this month, the Biden administration proposed regulations requiring interstate highways to have stations built in federal dollars within 50 miles.
Like Hertz, the enterprise focuses on commercial rental fleets and fleet management departments. In this department, business customers value lower maintenance and operating costs. “It’s a reliable advisor to those customers and helps them understand how EVs work and their benefits,” says Haffenreffer. But like leisure travel renters, it’s getting harder and harder to understand how to move from point A to point B and how to charge a car, Haffenreffer said.
Based in Parsippany, NJ, Avis saw a stock rocket in early November after announcing that it would enter the EV rental business a week after the Hearts-Tesla deal was signed. “As the situation progresses, we’ll see that we’re more aggressive in the electric vehicle scenario,” he told analysts at the conference call at the time.
Since then, Avis has been silent and declined to comment on this article. But Waronka said, “I believe in their words.” He quoted the exposure of the fleet of quite a few car rental companies as a reason. “They aren’t ready to pull the curtain back to what they’re doing,” he said.
US car makers are spending billions of dollars to increase EV production. General Motors By the end of 2023, it aims to deliver 400,000 EVs in North America, and Ford has promised 600,000 by then. Given that EV rental is essentially an extended test drive, the rental market is President Joe Biden’s plan Half of all new cars and trucks sold in 2030 were zero-emission vehicles.
“From our point of view, the car rental market makes a lot of sense, especially as OEMs enter the long-distance electric vehicle,” said Ben Prochazka, executive director of the Electrification Coalition. “It’s a great way to introduce new technology to consumers in a low-risk environment.”