In 2021, rental car company Hertz Global Holdings Inc. tapped Tom Brady to promote its massive push to electrify its fleet.
At the time, Hertz placed a huge order for 100,000 Tesla Model 3 vehicles.
Fast forward to late October, when Hertz Chief Executive Stephen Scherr told investors on a third-quarter earnings call that the company would start reducing its EV fleet because of high repair costs compared to the rest of the fleet, which has hurt its bottom line. "EV's will be slower than our prior expectations," he said.
In late October, Scherr told CNBC's Jim Cramer that EVs are seeing more damage than combustion engine cars, and the cost to repair them is much higher.
According to Bloomberg, Hertz began dumping 20,000 EVs on the used car market last month and will be a seller through 2024. The sales are expected to record a non-cash charge in the fourth quarter of $245 million related to incremental net depreciation expense.
"The company expects to reinvest a portion of the proceeds from the sale of EVs into the purchase of internal combustion engine vehicles to meet customer demand," Hertz said, adding, "The company expects this action to better balance supply against expected demand of EVs."
As of last October, Scherr said EVs were about 11% of Hertz's total fleet, with Tesla accounting for 80%.
The company is selling older Teslas on its website. EV blog Electrek said, "There were some nice deals available."
Meanwhile, Hertz is selling EVs in a downturn in the used car market. This could push prices lower.
So much for Hertz's full-scale EV adoption...