- Hertz says EV reservation requests rose sharply in March.
- Turo also saw bookings spike when gas cruised past $4.
- US sales of new EVs still lag despite rental curiosity surge.
Americans may not be rushing to buy electric cars, but they are increasingly happy to borrow them. With gasoline prices climbing above $4 per gallon, rental firms are seeing a noticeable jump in demand for EVs.
At Hertz, which de-fleeted 30,000 electric cars after repair costs ballooned, requests for EV reservations in March were up nearly 25 percent compared with February, Reuters reports. The strongest gains reportedly came from the West Coast, where fuel prices are usually painful even before geopolitics joins the conversation, and drivers are more open to EVs than those in some other states.
Related: Trump’s Energy Chief Put Gas Below $3 Next Year. President Says He’s Totally Wrong
For drivers covering serious miles, especially rideshare operators, cheaper charging can suddenly look very attractive. With access to a cheap electricity rate, fully charging an EV might only cost $10-20, versus as much as $60 to gas up a combustion vehicle.
Peer-to-peer rental platform Turo saw a similar shift. EV bookings during the final three weeks of March rose 11 percent compared with the previous three-week stretch. On March 31, the day average U.S. gas prices topped $4 for the first time since 2022, EV reservations were up 47 percent versus the same date last year, Reuters learned.
Hold-Ups At Hormuz
The spike in fuel costs follows disruptions around the Strait of Hormuz, one of the world’s most important energy shipping routes. With oil supply concerns pushing prices upward, US pump costs have risen by more than a third since late February.
US Fuel Prices
AAA
A gallon of regular gas currently costs on average $4.09, AAA says, but drivers were only paying $3.17 this time last year. And diesel prices have gone crazy, jumping from $3.56 last April to $5.47 today. Those are national averages, too. In California, regular is now $5.85 and diesel a staggering $7.49.
When gas jumps that quickly, people don’t always change what they buy. That takes longer. But they clearly do change what they rent, which is a less permanent financial commitment.
US EV Sales Still Down
That helps explain why rentals are moving faster than showroom sales. According to the report, new EV sales in the U.S. fell 25 percent in March compared with a year earlier. The loss of the federal $7,500 tax credit last autumn continues to weigh heavily on purchase decisions. But if gas prices stay stubbornly high, we’d expect to see EV sales get a bump.
They’re already climbing rapidly in Europe as a result of raised fuel prices there. EV sales were up 33.5 percent for Q1 and accelerated 51 percent in March off the back of the conflict in Iran and its impact on fuel costs.
