Sixt Rental Gets Rid of Its Tesla Fleet

The residual value problem of electric cars would play a major role in this decision by Tesla’s longtime customer.

Sixt began integrating Tesla Model 3 and Model Y into its fleet in 2022 to complement a wide range of electric vehicles already including several models (Fiat 500, Peugeot e-208, DS 3 e-Tense, Skoda Enyaq, etc.). The company is now renouncing the American manufacturer’s vehicles “We would like to inform you that we are no longer purchasing Tesla vehicles,” it stated in an email sent to its customers. Furthermore, we are reducing the number of Tesla vehicles in our rental fleet.”

As with all rental companies, the resale value of cars is crucial for Sixt, and this issue seems to affect Tesla more than other brands. While major car rental companies usually sell their cars to the manufacturer via a “buy-back” agreement and therefore bear no residual value risk, no such agreements exist with Tesla. Additionally, Tesla’s strategy to frequently change its selling prices makes any residual value forecasting extremely complex, if not impossible.

Although Sixt aims to achieve its overall goal of electrifying 70 to 90% of its fleet by the end of the decade, according to the company’s latest report, less than ten percent of its vehicles are currently electric, with only a marginal share of Teslas. Their volume would represent less than 5,000 units, a drop in the ocean globally but a thorn in the side that the rental company wants to get rid of. Once the wow factor of Tesla’s arrival has faded, only margins lower than other models remain, which is inevitably awkward. The case of Sixt is not unique, as Hertz has also recently admitted issues with its Teslas.