(Bloomberg) -- Sixt SE has cut the number of electric cars as customers prefer to rent vehicles with a combustion engine, in line with reductions by competitor Hertz Global Holdings Inc.
“We direct our share of EVs according to consumer demand and can very quickly react to demand changes,” Europe’s biggest rental car operator said Wednesday. Last year, Sixt had just under 10,000 battery-powered cars in its fleet of nearly 170,000 vehicles.
Purchases from rental companies are a boon for carmakers seeking to shift volumes, though EVs have turned out to be a difficult investment. Both Hertz and Sixt in recent months said they’ll offload Tesla Inc. cars after they turned out to be expensive to maintain and the carmaker’s aggressive price cuts undermined their resale value — a key risk in a rental company’s portfolio.
Sixt has reduced the number of used EVs it needs to resell, deemed “risk BEVs” to a “low four-digit” number at the end of the second quarter, the company said during an earnings presentation. The rest of the vehicles are bought back by carmakers, helping to insulate the company from a slump in residual values.
On Wednesday, the company declined to detail the current number of EVs in its fleet after last year’s level of 5.8%.
Shortly after the decision on Teslas, Sixt in January said it would buy as many as 250,000 vehicles from Stellantis NV as part of a multi-billion order for a mix of combustion-engine, plug-in hybrid and battery-electric cars.
Hertz in April said it was looking to offload some 10,000 electric vehicles from its fleet after lower rental rates and higher maintenance costs for EVs dragged on profitability.
Residual values — the amount a car is worth after a certain period of time — have fallen more quickly for electric models than for similar combustion engine vehicles.
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