As Hertz decides to sell 20,000 EVs, it is set to lose $245 million due to depreciation as Tesla reduced its EV prices|Nicholas Eckhart|CC BY-NC-SA 2.0

Car rental Hertz, which positioned itself as a proponent of EVs, has decided to sell 20,000 electric vehicles—one-third of its US EV fleet. The move would cost the company $245 million.

It plans to use some of the proceeds to buy regular gas-powered cars.

The announcement affected the company’s share price, which dropped 4.3%, and its ripple effect also influenced Tesla shares.

Hertz had planned to buy 100,000 Teslas by the end of 2022, but by October 2023, it had bought just 35,000 EVs from the company.

The decision comes amid weaker demand for electric cars and higher operating costs as EVs are more expensive to repair and maintain.

Hertz’s move reflects a broader industry trend, with automakers scaling back on EV projects and production forecasts due to signs that Americans aren’t adopting battery-powered cars as rapidly as anticipated.

On the bright side, consumers can bag a used Tesla from Hertz for as low as $20,000.