Hertz and GM Plan Large EV Expansion
In a landmark deal, Hertz (NASDAQ: HTZ) and General Motors Co. (NYSE: GM) have announced their intention to revolutionize the rental car industry. Hertz plans to order up to 175,000 electric vehicles (EVs) from GM’s diverse portfolio, which includes Chevrolet, Buick, GMC, Cadillac, and BrightDrop, over the next five years. This plan is not only significant for its scale, marking the largest expansion of EVs among fleet customers, but it also stands out for its breadth. The order will encompass a wide range of vehicle categories and price points — from compact and midsize SUVs to pickups, luxury vehicles, and beyond. This ambitious collaboration illustrates both companies’ commitment to accelerate the transition towards sustainable transportation.
The stipulations of the agreement dictate that electric vehicle deliveries from GM to Hertz will continue through to the year 2027. This move is two-fold: Hertz aims to steadily increase the electric vehicle component of its expansive fleet, while GM concurrently accelerates the overall production of EVs. Over the course of this period, projections by Hertz suggest that their customers might clock in more than 8 billion miles in these electric vehicles. This is forecast to result in substantial environmental benefits, with estimates indicating that around 3.5 million metric tons of carbon dioxide equivalent emissions could be saved. This figure is calculated in comparison to the emissions that would otherwise be generated by gasoline-powered vehicles traveling a similar distance.
“It’s exciting that two iconic American companies that have shaped the evolution of transportation for more than a century are coming together to redefine the future of mobility in the 21st century,” said Stephen Scherr, Hertz CEO. “We are thrilled to partner with GM on this initiative, which will dramatically expand our EV offering to Hertz customers, including leisure and business travelers, rideshare drivers and corporates.”
“Our work with Hertz is a huge step forward for emissions reduction and EV adoption that will help create thousands of new EV customers for GM,” said GM Chair and CEO Mary Barra. “With the vehicle choice, technology and driving range we’re delivering, I’m confident that each rental experience will further increase purchase consideration for our products and drive growth for our company.”
As part of its commitment to sustainable transportation, Hertz is investing heavily to establish the largest rental fleet of electric vehicles (EVs) in North America. The goal is to make tens of thousands of EVs available for rent at more than 500 Hertz locations across 38 states. The company has set a target for a quarter of its fleet to be electric by the year-end of 2024.
In the first quarter of the upcoming year, Hertz expects to start receiving deliveries of Chevrolet Bolt EVs and Bolt EUVs. As per the projections, the number of GM vehicles delivered to Hertz will increase as GM scales up its EV production between 2023 and 2025. This amplification in GM’s production capacity is anticipated to be driven by the opening of Ultium Cells battery cell manufacturing plants in Ohio, Tennessee, and Michigan. By 2025, GM envisions having an annual production capacity of 1 million EVs in North America.
