Tesla rental demand 'very, very solid,' Hertz CEO says

Tesla (TSLA) rental demand appears to be off to a brisk start for Hertz (HTZ).

"Demand has been very, very solid," Hertz CEO Stephen Scherr said in an exclusive Yahoo Finance Live interview Tuesday (video above). "We’re seeing demand not just among leisure travelers but also among corporate travelers, where in fact corporations want their employees in an electric vehicle to satisfy some of their own carbon footprint objectives."

Hertz inked a deal late in 2021 to purchase 100,000 Tesla Model 3s for its fleet by the end of 2022. The company has since added the Tesla Model Y to the mix. Besides Tesla, the company also recently signed EV deals with General Motors (GM) and Polestar (PSNY).

China-made Tesla Model 3 vehicles are seen at the Shanghai Gigafactory of the U.S. electric car maker in Shanghai, China December 30, 2019.  REUTERS/Yilei Sun
China-made Tesla Model 3 vehicles are seen at the Shanghai Gigafactory of the U.S. electric car maker in Shanghai, China December 30, 2019. REUTERS/Yilei Sun

The company aims to have 25% of its fleet be EVs by the end of 2024. Currently, about 5% of the fleet is electric, Scherr said.

Given the influx of driver-friendly EVs and solid travel demand, Scherr struck an upbeat tone on the outlook for holiday season bookings.

"Bookings have been positive out through the next couple of months, but equally... through the holiday period where it's proving quite strong," said Scherr, who took over as Hertz CEO earlier this year after many years in executive roles at Goldman Sachs.

Hertz stock got a boost on Tuesday after the rental car company revealed a new EV charging station deal with oil giant BP. Shares were up more than 2% as of 2:00 p.m. ET.

Hertz plans to have thousands of charging stations nationwide by the end of 2023 as part of the agreement, and Scherr stated he is on the hunt for similar charging station deals.

"One of the real issues why engaging with BP is an important step is that not only are they going to build out charging stations — mostly fast chargers on our facilities — but we are going to use their energy management tools and software to sort of overcome range anxiety," Scherr said.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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