WSJ sources spoke about problems in negotiations on the supply of 100 thousand Teslas to Hertz

Tesla and Hertz continue to negotiate a record contract to supply 100,000 electric vehicles to a car rental operator. While the parties have not agreed on the terms of the agreement, sources told The Wall Street Journal .

Hertz announced back on October 25 that, under pre-order conditions, electric vehicles would join the company's fleet by the end of 2022. At the same time, there were no comments from Tesla representatives in the press release. On November 1, Tesla founder and CEO Elon Musk tweeted that the contract had not yet been signed, which caused alarm among many investors who had driven Tesla's capitalization above $1 trillion.

According to one of the WSJ interlocutors familiar with the negotiations, many Tesla managers were surprised at how quickly Hertz publicly announced the conclusion of the agreement and the timing of its implementation. According to expectations inside Tesla, based on current production capacity, the company will be able to supply the car rental operator with only about 10,000 cars a year. At the same time, another source of the publication assured the WSJ that the press release was approved by Tesla representatives before publication.

All interlocutors of the publication agree - the details of the transaction continue to be intensively discussed. Tesla insists there are no price or time preferences for Hertz, despite the volume of the order. This means deliveries could drag on for years and cost the car rental operator more than $4 billion.

A Hertz spokesperson, despite Musk's words, reiterated to the WSJ that the operator is waiting for a pre-order for 100,000 electric vehicles to be filled and that deliveries under the supposedly unsigned contract have already begun. Hertz customers really already have the opportunity to rent a Tesla Model 3 today.

Musk himself, according to WSJ sources, is deeply involved in the negotiation process. But, according to the accepted practice of such contracts, the final agreement can be concluded only when Tesla fully integrates the volumes required by Hertz into its production cycle.

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