Tesla Model 3 with mileage and more: Hertz offers its customers to buy back a leased electric car
The rental company Hertz has started to actively get rid of its electric cars due to a sharp decline in their residual value. Unusual methods were used - the company directly offers its customers to buy back the rented car at an attractive price.
Here's What We Know
One Reddit user shared a screenshot of an email from Hertz received when renting a 2023 Tesla Model 3. In the email, Hertz offered to purchase the car for just $17,913. According to the user, the car's mileage was less than 30,000 miles (~48,000 km). Interestingly, a 2022 Tesla Model 3 2022 is also available on the Hertz website for under $20,000 but with over 130,000 miles (~209,000 km).
Screenshot of an email from Hertz offering to buy back a Tesla Model 3. Illustration: Reddit
What are the risks?
Buying a car from a rental company can be profitable, but it's worth remembering the wear and tear. These cars are usually used more intensively than personal cars. In the case of Tesla, it's important to consider the battery warranty - 8 years or 100,000 miles (for rear-wheel drive models). Buying cars with a warranty greatly reduces the risk of costly repairs.
Polestar is also for sale
Another Reddit user received an offer to buy back a leased Polestar 2 for $28,500. However, this offer looks less attractive: on Auto Trader, such cars with up to 20,000 miles are selling for $25,000 or less.
Why is Hertz selling off its electric cars?
In 2021, Hertz announced a massive project to electrify its rental car fleet, with plans to purchase more than 100,000 Tesla vehicles. However, it started getting rid of some of its electric cars as early as December 2023. As Electrek explained, Hertz picked a bad time to acquire electric cars. It started buying Tesla en masse at the peak of prices, just before the automaker drastically reduced them. This caused the residual value of Tesla cars at Hertz's disposal to plummet.
UPDATE: We received a comment from Hertz. Here's what a company spokesperson stated:
“Everyone knows we rent cars but perhaps you don't know we sell them too. We have 40 retail locations you can visit nationwide but you can also check them out online! Our commitment to a modern, diverse fleet means we offer well-maintained vehicles nationwide at competitive prices, typically below Kelley Blue Book value. From luxury models and SUVs to sedans and EVs, we've got options at great prices. And if you're renting a vehicle that will soon join our sales inventory, we often let you know.”
The company has also emphasized that when drivers rent from Hertz, they have access to a wide variety of newer, well-maintained vehicles, giving customers at Hertz Car Sales the opportunity to purchase quality pre-owned vehicles. Most of the cars for sale are 2024 models or one year old and priced competitively. Every car sold by Hertz undergoes a rigorous 115-point inspection and includes a 12-month/12,000-mile limited powertrain warranty.
Source: Carscoops
