Sixt Dumping Teslas Due To High Repair Costs & Depreciation
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Wowza. For years, we’ve argued that one of the top reasons to buy a Tesla Model 3 or Model Y is because of their low total cost of ownership. And the more miles per year, the better the savings. Many of us have stories and spreadsheets highlighting our low operational costs (I’ve got an update coming this weekend), but the key buyers who can really analyze these numbers in a statistically significant way are fleet buyers, like rental car companies. The bad news: rental car companies have gone from big Tesla fans to avoiding and dumping Teslas. Yikes!
I already reported about a month ago on Hertz scaling back its plans with Teslas. The reasons: maintenance costs (especially tires), repair costs, and depreciation have been higher than expected. Now we have reporting that the rental car giant Sixt is facing the same problems and scaling back its Tesla offerings as well. Really, I have to say it again: yikes! This is a pillar of the pro-EV argument, and even if this is mostly a Tesla problem, Tesla is a large part of the EV market and the biggest brand representative.
The difference with Sixt compared to Hertz is that Sixt is actually selling off some of its Teslas in order to solve its problems with them (instead of buying fewer than initially planned). Also, according to Jalopnik, Sixt has nailed down to the conclusion that Teslas are the problem, not electric vehicles in general. “While Hertz is taking a step back from electric cars altogether, Sixt is directly singling out Tesla here, as it continues to increase its electric fleet,” they write. “The company’s goal is to slowly replace its gasoline and diesel-powered cars until at least 90 percent of its fleet is electric, and it aims to do so by the end of this decade. Unless Tesla improves its quality, collision repair costs, and residual values, the second-largest rental fleet in Europe (and fourth-largest in the U.S.) won’t include cars from the American automaker.”
As if all of those blows weren’t enough, there’s a final blow that has to sting a little: Sixt is switching from Teslas to BYDs. Tesla and BYD are in a neck-and-neck battle for title of best selling EV automaker in the world. Tesla has long held the title for pure BEVs, while BYD is far in the lead if you throw in plugin hybrids, but the BEV race has gotten super tight. Sixt moving from Tesla to BYD at this time seems like a funny coincidence, or perhaps something more about trends in the industry. “In the battle for EV fleet supremacy, Sixt is ditching its Tesla fleet in favor of the less expensive and easier to repair Chinese vehicles from BYD. The entire Sixt fleet totals around a quarter of a million automobiles in 100 countries, and the company has committed to buy at least 100,000 BYD electric cars. Sixt was the first rental company to contract with BYD in Europe, and the experiment seems to have paid off.” We wrote about the start of that partnership last year. Kudos to BYD for its continued success, and for apparently making Sixt quite happy.
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