Stellantis has signed a monumental deal to supply up to 250,000 vehicles to Sixt, Europe’s largest car rental company. This agreement, notably struck soon after Sixt decided to phase out Tesla vehicles from its fleet, marks a significant shift in the car rental industry’s approach to fleet composition and electric vehicle (EV) adoption.
The deal, spanning several billion euros, involves the delivery of a diverse range of vehicles, including combustion-engine, plug-in hybrid, and battery-electric models. This fleet will be sourced from various Stellantis brands such as Alfa Romeo, Chrysler, Citroen, Fiat, Jeep, Opel, Peugeot, Ram, and Maserati.
The first deliveries are set to commence this quarter, with the vehicles slated for distribution across Sixt’s rental operations in Europe and North America over the next three years.
This multi-billion euro partnership, spanning 250,000 vehicles over three years, marks a significant departure from Sixt’s previous heavy reliance on Tesla. The question arising in everyone’s mind is why the abrupt change of direction?
This development comes amid a broader reassessment within the car rental industry regarding the integration of EVs into their fleets. Challenges such as high repair costs and depreciating resale values have prompted companies to rethink their strategies. Sixt’s decision in December to remove Tesla vehicles from its lineup was influenced by these factors, particularly after Tesla’s price cuts led to a significant depreciation in the value of its used cars.
Interestingly, Sixt plans to continue its commitment to electrification, aiming to electrify up to 90 percent of its fleet in Europe by the end of the decade. This ambition was highlighted in 2022 when Sixt signed a deal to purchase up to 100,000 EVs from China’s BYD over six years. Such initiatives indicate that while immediate concerns are leading to adjustments in EV policies, the long-term vision towards electrification remains intact.
The Stellantis-Sixt deal reflects a broader trend in the automotive industry, where traditional automakers and rental companies are increasingly collaborating to navigate the transition to electric mobility.
This trend is not isolated to Sixt. For instance, Hertz Global Holdings, another rental giant, recently announced plans to unload a third of its U.S. electric-vehicle fleet, citing similar issues of weak demand and high repair costs. Hertz even offered Tesla Model 3 sedans on its website for less than $18,000, a stark indication of the rapid depreciation these vehicles faced.
Such developments are reshaping the dynamics between automotive manufacturers and rental companies. Traditional automakers like Stellantis are finding new opportunities to expand their market reach and test their diverse range of vehicles, from internal combustion engines to EVs, in the rental market. On the other hand, rental companies are balancing the need to modernize their fleets with EVs while managing the economic and operational challenges that come with such a transition.
Stellantis-Sixt deal is a significant indicator of the evolving strategies in the automotive and car rental industries, particularly in the context of electric vehicle adoption. As the industry navigates the complexities of transitioning to electric mobility, such partnerships and strategic decisions are likely to become more common, shaping the future of automotive fleets and the broader EV market.
