Change of direction
Today, more and more electric cars are appearing on the market. Car enthusiasts flock there en masse, but not only. Indeed, this also applies to companies that want to green their fleet en masse. We are thinking, for example, of rental companies that should offer more and more zero-emission cars. This is, for example, the case of Hertz in the United States or Europe. But the American company has been changing its plans over the months. Indeed, the latter recently took the bold step of suspending purchases electric models. It all started with Tesla, many of which have been resold in recent months. But now it’s the turn of Polestar cars. This decision, although radical, is motivated by economic and operational considerations. Don’t panic, we’ll explain everything to help you understand this amazing, but not so amazing strategy.
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Many reasons
The price war started by Tesla has had significant consequences for the used car market. The residual value of electric vehicles has fallen, making it difficult to operate resale at moderate prices. Hertz, as a rental company, faced this problem. Its operating model, which involves purchasing vehicles directly rather than signing resale agreements with manufacturers, also contributed to this situation. In addition to the rapid depreciation of residual value, Hertz faced higher-than-expected maintenance and repair costs for its fleet. Indeed, vehicles require special maintenance, and these costs negatively affect the company’s profitability. So, the company recently informed the Polestar management about the need to suspend the 2022 agreement. This agreement provided for the purchase of at least 65,000 Polestar cars over five years and therefore will not be implemented. In addition, the company has pledged to replace part of its electric cars with traditional cars.
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Source: Auto Plus
Robert is an experienced journalist who has been covering the automobile industry for over a decade. He has a deep understanding of the latest technologies and trends in the industry and is known for his thorough and in-depth reporting.