Car rental company Hertz has ordered 100,000 Teslas, making it the largest electric vehicle rental company in the world.
Announcement of the deal, which Hertz hopes to see fulfilled by the end of 2022, pushed Tesla market value to over $1 trillion – only the fifth such firm ever to reach this milestone. Shares in the electric carmaker climbed 12.6% after it struck the Hertz deal. While brands such as Ford and GM make more cars, Tesla has been the world’s most valuable carmaker for some time. Previously only Apple, Microsoft, Amazon and Google-owner Alphabet have reached a $1tn valuation.
Despite this, however, Tesla is reported to be struggling to fulfill orders owing to a serious backlog caused by global supply chain problems. “Our backlogs are continuing to grow and average customer wait times are extending,” the company’s chief financial officer Zach Kirkhorn told investor.
Starting in early November though, customers will be able to rent a Tesla Model 3 at Hertz airport and neighbourhood locations in major US and select European cities. Hertz also is installing thousands of chargers throughout its location network. Customers who rent a Tesla Model 3 will have access to 3,000 Tesla supercharging stations throughout the US and Europe.
“Electric vehicles are now mainstream, and we’ve only just begun to see rising global demand and interest,” Hertz interim CEO Mark Fields told journalists. “The new Hertz is going to lead the way as a mobility company, starting with the largest EV rental fleet in North America and a commitment to grow our EV fleet and provide the best rental and recharging experience for leisure and business customers around the world.”
Hertz says that it will offer a premium and differentiated rental experience for Tesla EVs. This will include digitised guidance to educate customers about the electric vehicle, and “an expedited EV rental booking process through the Hertz mobile app”.
EVs will comprise more than 20% of Hertz global fleet and they are expected to be supported by a combination of Level 2 autonomy and DC fast charging in approximately 65 markets by the end of 2022, and more than 100 markets by the end of 2023. Hertz adds, however, that these ambitions could be affected by factors outside of its control, “such as semiconductor chip shortages or other constraints”.