The Associated Press reported that Hertz last week announced an order for 100,000 Tesla electric cars to add to its fleet, although “no contracts have yet been signed,” tweeted Elon Musk.
Hertz responded to Musk’s tweet in an email on Tuesday, saying its plans had not changed.
“As we announced last week, Hertz has placed an initial order of 100,000 Tesla electric vehicles by the end of 2022 and is investing in new EV charging infrastructure across the company’s global operations,” the company said in an email. “Tesla’s deliveries have already begun, and consumer response to our commitment to leading the way in electrification has exceeded our expectations.”
News of the deal soared Tesla’s stock last week, pushing its market cap to over $1 trillion for the first time. Shortly after the market closed on Monday, an account called the Tesla Silicon Valley Club tweeted about Tesla’s 8.5 percent profit and thanked Musk. Musk tweeted a reply an hour later: “You’re welcome! If any of this is based on Hertz, I’d like to stress that no contracts have been signed yet.”
Financial details of the deal, such as how much Hertz might pay per car or the total price of the deal, were not disclosed, though Musk said in response to the same tweet on Monday that Hertz would not receive the discount.
Musk’s tweet said, “Tesla has far more demand than it produces, so we will only sell cars to Hertz for the same margin that consumers get.” “The Hertz deal has zero impact on our economics.”
For more reporting from the Associated Press, see below.
In an interview with the AP last week, Hertz’s interim CEO, Mark Fields, said that Teslas were already coming to the company’s sites and should be available to rent sometime this month.
It’s not entirely clear why Musk would complicate or potentially sabotage the Hertz deal, but public comments like his are about leverage in negotiations.
Bill Selesky, a senior analyst at Argus Research, suggests that Musk understands the value of his brand as a leader in electric vehicles and is trying to do as little as possible from Hertz.
“Hertz, if they do make a deal with Tesla, will immediately be recognized as part of the EV revolution, not a problem,” Selesky said.
Tesla shares fell 1.5 percent to $1,190 per share in early trading Tuesday.