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I don’t get it, what changed in between 2021 and now? Back then we were told that electric cars were faster, cheaper to operate, quieter, and better for the env

I don’t get it, what changed in between 2021 and now? Back then we were told that electric cars were faster, cheaper to operate, quieter, and better for the environment. Isn’t all that still true today? Why are they losing value then?

infecto 2y ago
Mostly true but for fleet vehicles it might not be a great decision. 1) Charging complexity at Hertz, turnaround time for vehicles that are not fully charged. 2) Body Repairs. Tesla is still notorious for bad repair lead times and costs. 3) 2021 was near peak Tesla pricing.
- amputect 2y ago
  #2 was definitely a problem for them; Teslas are out of action longer because of the wait times, AND they are more expensive to repair (which means they're more expensive to insure, and some carriers won't cover them at all). Being out longer costs Hertz a lot of money, and having to eat higher maintenance costs on top of that is a brutal double-dip. edit just to add: This is much less of a problem for individual owners; I know people who are still happy with their Teslas, and a single person needing a single replacement car while theirs is awaiting repair is not a big deal. But a car company needing a thousand replacements while a thousand cars are sitting in storage is pretty bad for them.
mlyle 2y ago
The cost of new electric cars has fallen. This impacts the resale value of older cars. Further, these were relatively early model 3 with not great initial quantity, and Hertz had a bad operational experience for various reasons that are causing them to unload a bunch all at once. Finally, Musk’s antics are arguably causing brand damage. All of these impact resale value.
- Sohcahtoa82 2y ago
  > The cost of new electric cars has fallen. This impacts the resale value of older cars. It's really amazing to see. I bought my Model 3 Performance in 2019 for ~$57K. If I were to buy today, it'd be $56K. Now, a $1K drop doesn't seem like a lot, but there's been a lot of inflation in the last 5 years, and the M3P today has a couple newer features that mine doesn't have, like a power lift trunk, heated steering wheel, adaptive suspension, a screen for the rear seats, and faster acceleration. Accounting for inflation alone, the M3P today should be costing ~$70K. With all the added features, it really should be $75K. But it's only $56K.
  - vel0city 2y ago
    It's insane you think a car with power liftgate and heated steering wheel should be a $70k car today. $40k cars in 201x had these features.
    - Sohcahtoa82 2y ago
      I don't think it should be a $70K car today because of the power lift gate, I think it should be $70K because of inflation, and the fact that it does 0-60 mph in 2.9 seconds.
  - frumper 2y ago
    Tax credits too. In 2019 you probably got a partial credit, in 2020-2022 you didn't get any federal credit. Today's M3P is now $49k with an instant credit. https://www.tesla.com/blog/what-you-need-know-about-federal-ev-tax-credit-phase-out https://www.tesla.com/blog/what-you-need-know-about-federal-...
    - Sohcahtoa82 2y ago
      Yeah, I got $1,750 federal credit, though I didn't factor that into my price.
ninju 2y ago
Rental cars, since they're driven more heavily than personal vehicles, require more maintenance. My guess it that Hertz did not make the investment in the repair infrastructure (batteries, brakes, electrical) that was needed to support 100,000 vehicles
ksherlock 2y ago
Due to oversupply, increased competition, etc, the price of a new model 3 has dropped and the resale price of a used model 3 has dropped.
burkaman 2y ago
There's a lot more competition now.
ghaff 2y ago
I am almost certainly renting something because I need to go to a few places. I don't want unfamiliarity and I'm probably not especially cost-sensitive. I wouldn't rent a Tesla unless I wanted the novelty in a predictable situation like within Silicon Valley.
lostlogin 2y ago
Musk is utterly repellant to many, BYD is eating up market share, need Tesla’s have got cheaper, compelling electric vehicles are available from multiple manufacturers and charger networks are more accessible to non Tesla EVs.
- janalsncm 2y ago
  > BYD is eating up market share In America? I thought Uncle Sam put a stop to that.
realusername 2y ago
It's Tesla which is losing value, not electric cars.
maeil 2y ago
This is very specifically about Tesla, not electric cars in general. The biggest issues that Hertz is seeing are particular to the models they bought, early Tesla Model 3's, not the fact that they're electric in itself.
s1gsegv 2y ago
The depreciation we’re seeing may genuinely be wealth gap related. The people on one side of the gap want a new Tesla rather than a used one, and on the other side you may not have stable charging infrastructure i.e. in an apartment, don’t want to pay an electrician to upfit their house, or are just straight up hanging back on older cars. I, for one, bought a used electric car recently for over half off the MSRP and it’s been an excellent car. It’s quiet, it’s fast, if I sit in my garage for 5 minutes when I arrive and answer a text message blowing the air conditioning that’s fine. I even just charge with the 120V outlet. But if you don’t have the ability to charge at home or work, it’s going to be more annoying than visiting a gas station, so likely better to stick with ICE for now.
sandworm101 2y ago
>> I don’t get it, what changed in between 2021 and now? It is more about what didn't change. Tesla hasn't changed, at least it has not kept up with the times. For those who want them, there are better/cheaper/more reliable electric cars on the market. Tesla's answer to the new market is largely just more of the same. Except the Tesla pickup, which was new but also just plain horrible. That fiasco has seriously tarnished the brand.
deleted 2y ago
[deleted]
janalsncm 2y ago
The article mentions that Tesla cut prices on new vehicles. So if you can buy a new Model Y for cheaper there’s no reason to pay what Hertz thought they could resell for.
xeromal 2y ago
Hertz net worth is partially in the vehicles they own. If they need cash, they can sell the cars to make it back. They know that the cars are depreciating assets but they also know that they're still assets. Tesla decided to decrease the amount of profit it made on each car in order to keep a higher sales volume and by doing so caused Hertz cars to instantly depreciate as people could buy a new tesla for cheaper than a used one. Tesla's profit margin was and probably still is higher than most manufacturers so they can afford to drop prices while hertz could not. This kind of reminds me of First Republic bank crashing because 10 year TBills became cheaper than 1 year TBills thanks to the anti-inflation measures the fed used to combat inflation. An unusual set of circumstances.

infecto 2y ago

Mostly true but for fleet vehicles it might not be a great decision. 1) Charging complexity at Hertz, turnaround time for vehicles that are not fully charged. 2) Body Repairs. Tesla is still notorious for bad repair lead times and costs. 3) 2021 was near peak Tesla pricing.

amputect 2y ago
#2 was definitely a problem for them; Teslas are out of action longer because of the wait times, AND they are more expensive to repair (which means they're more expensive to insure, and some carriers won't cover them at all). Being out longer costs Hertz a lot of money, and having to eat higher maintenance costs on top of that is a brutal double-dip. edit just to add: This is much less of a problem for individual owners; I know people who are still happy with their Teslas, and a single person needing a single replacement car while theirs is awaiting repair is not a big deal. But a car company needing a thousand replacements while a thousand cars are sitting in storage is pretty bad for them.

mlyle 2y ago

The cost of new electric cars has fallen. This impacts the resale value of older cars. Further, these were relatively early model 3 with not great initial quantity, and Hertz had a bad operational experience for various reasons that are causing them to unload a bunch all at once. Finally, Musk’s antics are arguably causing brand damage. All of these impact resale value.

Sohcahtoa82 2y ago
> The cost of new electric cars has fallen. This impacts the resale value of older cars. It's really amazing to see. I bought my Model 3 Performance in 2019 for ~$57K. If I were to buy today, it'd be $56K. Now, a $1K drop doesn't seem like a lot, but there's been a lot of inflation in the last 5 years, and the M3P today has a couple newer features that mine doesn't have, like a power lift trunk, heated steering wheel, adaptive suspension, a screen for the rear seats, and faster acceleration. Accounting for inflation alone, the M3P today should be costing ~$70K. With all the added features, it really should be $75K. But it's only $56K.
- vel0city 2y ago
  It's insane you think a car with power liftgate and heated steering wheel should be a $70k car today. $40k cars in 201x had these features.
  - Sohcahtoa82 2y ago
    I don't think it should be a $70K car today because of the power lift gate, I think it should be $70K because of inflation, and the fact that it does 0-60 mph in 2.9 seconds.
- frumper 2y ago
  Tax credits too. In 2019 you probably got a partial credit, in 2020-2022 you didn't get any federal credit. Today's M3P is now $49k with an instant credit. https://www.tesla.com/blog/what-you-need-know-about-federal-ev-tax-credit-phase-out https://www.tesla.com/blog/what-you-need-know-about-federal-...
  - Sohcahtoa82 2y ago
    Yeah, I got $1,750 federal credit, though I didn't factor that into my price.

ninju 2y ago

Rental cars, since they're driven more heavily than personal vehicles, require more maintenance. My guess it that Hertz did not make the investment in the repair infrastructure (batteries, brakes, electrical) that was needed to support 100,000 vehicles

ksherlock 2y ago

Due to oversupply, increased competition, etc, the price of a new model 3 has dropped and the resale price of a used model 3 has dropped.

burkaman 2y ago

There's a lot more competition now.

ghaff 2y ago

I am almost certainly renting something because I need to go to a few places. I don't want unfamiliarity and I'm probably not especially cost-sensitive. I wouldn't rent a Tesla unless I wanted the novelty in a predictable situation like within Silicon Valley.

lostlogin 2y ago

Musk is utterly repellant to many, BYD is eating up market share, need Tesla’s have got cheaper, compelling electric vehicles are available from multiple manufacturers and charger networks are more accessible to non Tesla EVs.

janalsncm 2y ago
> BYD is eating up market share In America? I thought Uncle Sam put a stop to that.

realusername 2y ago

It's Tesla which is losing value, not electric cars.

maeil 2y ago

This is very specifically about Tesla, not electric cars in general. The biggest issues that Hertz is seeing are particular to the models they bought, early Tesla Model 3's, not the fact that they're electric in itself.

s1gsegv 2y ago

The depreciation we’re seeing may genuinely be wealth gap related. The people on one side of the gap want a new Tesla rather than a used one, and on the other side you may not have stable charging infrastructure i.e. in an apartment, don’t want to pay an electrician to upfit their house, or are just straight up hanging back on older cars. I, for one, bought a used electric car recently for over half off the MSRP and it’s been an excellent car. It’s quiet, it’s fast, if I sit in my garage for 5 minutes when I arrive and answer a text message blowing the air conditioning that’s fine. I even just charge with the 120V outlet. But if you don’t have the ability to charge at home or work, it’s going to be more annoying than visiting a gas station, so likely better to stick with ICE for now.

sandworm101 2y ago

>> I don’t get it, what changed in between 2021 and now? It is more about what didn't change. Tesla hasn't changed, at least it has not kept up with the times. For those who want them, there are better/cheaper/more reliable electric cars on the market. Tesla's answer to the new market is largely just more of the same. Except the Tesla pickup, which was new but also just plain horrible. That fiasco has seriously tarnished the brand.

deleted 2y ago

[deleted]

janalsncm 2y ago

The article mentions that Tesla cut prices on new vehicles. So if you can buy a new Model Y for cheaper there’s no reason to pay what Hertz thought they could resell for.

xeromal 2y ago

Hertz net worth is partially in the vehicles they own. If they need cash, they can sell the cars to make it back. They know that the cars are depreciating assets but they also know that they're still assets. Tesla decided to decrease the amount of profit it made on each car in order to keep a higher sales volume and by doing so caused Hertz cars to instantly depreciate as people could buy a new tesla for cheaper than a used one. Tesla's profit margin was and probably still is higher than most manufacturers so they can afford to drop prices while hertz could not. This kind of reminds me of First Republic bank crashing because 10 year TBills became cheaper than 1 year TBills thanks to the anti-inflation measures the fed used to combat inflation. An unusual set of circumstances.