Hertz just revealed plans of switching back to gas-powered vehicles

January 11, 2024 06:57 AM PST | By Invezz

Hertz just revealed plans of switching back to gas-powered vehicles — Image source: Invezz

Hertz will reinvest in gas-powered vehicles

The Nasdaq-listed firm also confirmed in its regulatory filing today that part of the proceeds from this sale will be used to reinvest in gas-powered vehicles.

Hertz cited higher repair costs and weak demand for electric vehicles for the switch that it expects will result in a non-cash charge of about $245 million in its fourth financial quarter.

The company based out of Estero, Florida will report its Q4 results in early February. Consensus is for it to lose 2 cents a share versus 50 cents per share of earnings a year ago.

Hertz stock is currently down over 50% versus its 52-week high.

Watch here: https://www.youtube.com/embed/j72d1UPfUHo?feature=oembed

Hertz expects a boost to its free cash flow

Hertz Global Holdings Inc expects the sale of EVs and going back to internal combustion engines to improve corporate EBITDA and boost free cash flow by up to $300 million in 2024-25.

[We] expect this action to better balance supply against expected demand for EVs.

Note that the car rental company once had a strategy focused on electric vehicles. It had even announced plans of buying 100,000 Teslas in 2021. But EV sales have slowed down ever since – rising 1.3% only in the fourth quarter of 2023.

EV sales surpass 1 mil in 2023 up over 40% YOY and 8% of total vehicle sales. Tesla maintains 51% market share. Still so many more EVs that can be sold annually… the tip of the iceberg. We need to educate the public! $TSLA https://t.co/0K0mGLfpnz
— Ross Gerber (@GerberKawasaki) January 10, 2024

Wall Street currently has a consensus “overweight” rating on Hertz stock.

The post Hertz just revealed plans of switching back to gas-powered vehicles appeared first on Invezz

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