Elon Musk says Tesla hasn’t signed a contract with Hertz yet

Elon Musk, CEO of Tesla, stands at the foundry of the Tesla Gigafactory during a press event.

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Tesla CEO Elon Musk said Monday night that his electric car company has not yet signed a contract with the car rental company hertz. Musk’s tweet appears to contradict an earlier announcement and announcement made by Hertz on October 25.

famously, Tesla Its market value reached 1 trillion dollars For the first time a week later Hertz announced It will grow its fleet of battery electric vehicles “to an initial order of 100,000 Tesla by the end of 2022.”

An ad featuring seven-time Super Bowl champion Tom Brady, along with Tesla Model 3 electric sedans parked in hertz Garage accompanying advertisement.

CNBC reached out to Hertz and Tesla to request more information Monday night. Neither company responded prior to publication.

Interim Hertz CEO Mark Fields said last week that the rental company started talking to Tesla “several months ago” about purchasing the vehicles. He described it as a “great relationship” and part of Hertz’s move to lead the leasing companies into managing large fleets of electric vehicles.

“This is about relationships. From that point of view, the Tesla relationship is very important to us, but … we also have relationships with all the automakers, and we want to help them as they introduce their electrified cars,” Fields said during an interview on CNBC’s Squawk Box”.

Fields, the former Ford CEO, called the move a “strategic discussion” to help automakers that started with Tesla and will continue with others. “We’ve done it with Tesla and our goal is to do it with all the automakers,” he said.

Investors have always resented automakers when they sell large quantities of vehicles to daily rental fleets. That’s because cars and trucks sold to rental companies are typically sold at a discount, deals like these are used to reduce bloated inventories and increase total vehicle deliveries.

However, shareholders and analysts responded favorably to the idea of ​​Tesla selling 100,000 all-electric cars to Hertz. The move was seen as a sign that battery-electric cars are becoming more common.

For example, Dan Ives of Wedbush Securities wrote in a bullish note about Tesla on October 26:

“The Hertz deal that we think will be seen as a turning point in the electric car industry as the $3/4 billion+ model deal for Tesla speaks to a more widespread adoption of electric vehicles as only 2% of cars in the US today are driven by electric vehicles.” Compared to 10%+ in China with rapid growth on the horizon. We believe this is the biggest shift in the auto industry since the 1950s as more consumers turn to the electric vehicle path over the coming years.”

Since Tesla closed October 22 before the announcement, the stock has risen about 33%.

Last week, Musk said it was “strange” that the news moved the company’s valuation so much.

Musk, who owns about 20% of Tesla, has seen his net worth rise with the electric car maker’s share price. He is now the richest person in the world.

Other shareholders inside and outside the company have also benefited Bulls long ago like Ron Baron, and the Tesla employees who acquired and acquired options over time and Musk’s options Fellow board members.

Two days after announcing the initial order for 100,000 Teslas, Hertz said it would make up to half of the cars available for Uber drivers For rent by 2023. “If successful,” the company said, the program could expand to 150,000 vehicles over the next three years.

Hertz noted that these ambitions could be affected by factors beyond their control, such as shortages of semiconductor chips or other limitations.

During the novel coronavirus epidemic, Hertz has filed for bankruptcy protection – but with travel rebounding somewhat and rental car demand increasing, investors from Knighthead Capital Management and Certares Management said. They will take over the company.


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