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American car rental company Hertz has placed an order for 100,000 Tesla Model 3 vehicles as part of a move to electrify its fleet. Such an order will now represent about $4.2 billion of revenue for Tesla and account for a huge chunk of production.
Hertz Global Holdings Inc. has placed an order for 100,000 Tesla Model 3s as a step towards its ambitious plan to electrify its rental car fleet. It will be the largest EV purchase known to date and is a great example for other companies in the fight to reduce CO2 emissions from combustion engine vehicles.
"Electric vehicles are now mainstream, and we've only just begun to see rising global demand and interest," said Hertz interim CEO Mark Fields. "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."
The deal represents about $4.2 billion in revenue for Tesla, Bloomberg News' sources said. Although car rental companies usually ask carmakers for big discounts, the cost of the order in Tesla means Hertz will pay almost according to the list price. It is very reasonable that Tesla, which is experiencing incredibly high demand for its cars, does not intend to make a significant price concession. All vehicles will be delivered over the next 14 months, sources said. This implies that Tesla will distribute car deliveries between private customers and Hertz.
Tesla Model 3 will be available for rent at Hertz offices in major U.S. markets and parts of Europe from early November. Customers will also have access to the Tesla Supercharger network. Apart from this, Hertz is also building its own charging infrastructure. Such an aggressive plan should significantly shake up the main players in the field, who are in no hurry to change and electrify their fleets.
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