(Bloomberg) -- Sixt SE is phasing out Tesla Inc. electric cars from its fleet after the manufacturer’s heavy price cuts hurt residual values at Europe’s biggest car-rental company.
Higher repair costs for electric cars compared to combustion vehicles are compounding the issues with lower resale values, Sixt said in an email to customers seen by Bloomberg News. The company still plans to electrify as much as 90% of its fleet in Europe by the end of the decade, according to a spokesperson.
Tesla’s aggressive price cuts have put EV makers globally under pressure as the US company seeks to maintain dominance in a growing field of competitors. Hertz Global Holdings Inc. in October said Tesla’s price drops have lowered resale values of EVs by one third.
Slowing EV demand in recent weeks has seen a number of carmakers scale back strategies in the transition. General Motors Co. said it was rethinking goals after sales were slower than anticipated, and Volkswagen AG has cut back production in Germany. Mercedes-Benz Group AG said the EV price war “brutal” and unsustainable.
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