Hertz Global Holdings will sell about 20,000 electric vehicles (EVs) from its U.S. fleet, the rental firm said on Thursday, citing higher expenses related to collision and damage, and opt for gas-powered vehicles.
Shares of the company, which operates EVs made by Tesla Inc and Swedish EV maker Polestar, fell as much as 9% in premarket trading.
“Expenses related to collision and damage, primarily associated with EVs, remained high in the quarter, thereby supporting the company’s decision to initiate the material reduction in the EV fleet,” Hertz said.
Hertz expects to recognize about $245 million of incremental depreciation expenses from the proposed sale in the fourth quarter of 2023.
Hertz said in April 2022 that it would buy up to 65,000 EVs over five years from Polestar, months after the rental car firm decided to order 100,000 Tesla vehicles by the end of 2022.
The company’s used car website has a variety of more than 700 EVs on sale, from BMW’s i3 and Chevrolet’s Bolt to Tesla’s Model 3 and Model Y SUVs.
