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Hertz places 100,000-rental-car order with Tesla for end of 2022

Order worth roughly $US4.4 billion demonstrates mainstreaming of EVs in North America

Subrat Patnaik and Sanjana Shivdas, Reuters
Oct 25, 2021  •  October 25, 2021  •  1 minute read  •  Join the conversation
Tesla vehicles in a parking lot on October 21, 2021 in Miami, Florida.
Tesla vehicles in a parking lot on October 21, 2021 in Miami, Florida. Photo by Joe Raedle /Getty

Elon Musk’s Tesla on Monday received its biggest-ever order, as Hertz announced it would buy 100,000 electric rental cars to go more eco-friendly just months after emerging from bankruptcy.

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The order from Hertz comes as Tesla is coping with a backlog of unfulfilled orders for its vehicles and continuing supply chain disruptions, but it does solidify the mainstream appeal of electric cars.

“Our backlogs are continuing to grow and average customer wait times are extending,” Chief Financial Officer Zach Kirkhorn told investors last week.

The world’s most valuable automaker delivered a record 241,300 electric cars globally in the third quarter, even as it warned that supply chain headwinds would pressure margins.

Tesla’s cheapest Model 3 sedan starts at about US$44,000, making this order worth about US$4.4 billion, if the entire order were for its mass-market sedan.

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With the current order, scheduled for delivery by the end of 2022, Hertz said EVs will make up more than 20 per cent of its global fleet.

The car rental firm also said it was installing thousands of chargers throughout its network. Customers who rent a Tesla Model 3 will have access to 3,000 Tesla supercharging stations throughout the United States and Europe.

“Electric vehicles are now mainstream, and we’ve only just begun to see rising global demand and interest,” said Hertz interim Chief Executive Officer Mark Fields.

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