Electrifying Los Angeles: Our Launch of EV Rentals & Continued Journey

Kyte believes in an electrified future and has an ambition to operate the largest electrified fleet on the planet, making sustainable mobility more accessible for all. This year we have tripled the number of electric vehicles (EVs) in our fleet. While these vehicles were initially exclusive to our subscription customers, we will begin offering EVs for daily rentals in Los Angeles starting September 1st.

As we celebrate this milestone, we wanted to share some reflections on electrification trends that have helped shape where we are and where we are headed.

We consider four main stakeholder groups that are influencing the adoption of EVs, with big changes happening across the board.

Government initiatives to promote the use of EVs have accelerated in the past few years. In the United States, the Biden administration has announced a 50% electrification target for 2030 coupled with more strict rules on tailpipe emissions. The administration has also proposed regulations that would require EV charging stations, funded with federal resources, to be no more than 50 miles apart along interstates. Notably, Nevada, Minnesota, and Virginia have joined California and ten other states in agreeing to establish zero-emission vehicle quotas for new passenger cars by 2035.

The US has also introduced an electric vehicle tax credit which is offered to consumers and businesses who purchase qualifying plug-in electric or “clean” vehicles, reducing their cost. The credits contribute to a $400 billion in investment in clean energy - America’s largest investment to fight climate change.

We see even stronger regulatory push in the European Union, which has drafted policies aimed at reducing the average emissions of all cars in operation by 55% by 2030 (from 2021 levels). Going beyond this, the EU has prohibited the sale of new ICE (internal combustion engines) vehicles starting in 2035, setting an end date for the “ICE age” in Europe.

Automakers’ investment in electrification has intensified over the past few years. Investments in hybrids and hydrogen-powered fuel cells have not disappeared entirely, but automakers are now redirecting their development efforts toward all-electric vehicles.

*Prominent players like Toyota and Volkswagen have committed a combined $250 billion by 2030 to EV and battery programs

*Jaguar and Volvo, meanwhile, are setting targets to sell only BEVs (Battery Electric Vehicles) and hybrids from as early as 2025, while a host of other manufacturers have set a 2040 target date

*BMW and Daimler announced a substantial $1 billion investment toward a new venture aimed at creating innovative mobility services such as ride-sharing solutions and charging infrastructure for EVs

*Volkswagen’s investments in EVs are expected to enable the company to achieve annual sales exceeding 1.4 million EVs by 2025, aiming to position Volkswagen as the leading EV manufacturer surpassing all competitors

The entire automotive sector is preparing its gears for the EV challenge. Car manufacturers worldwide are reevaluating and restructuring their traditional business models, aiming to embrace this new era where electric power replaces conventional fuels. The high costs associated with developing EVs encourage companies to seek partnerships and new innovative ways to be top in the race.

Global EV adoption is expected to reach 45% by 2035 driven by falling ownership costs (supported by government incentives). The five-year total cost of ownership (TCO) for a midsize car is now the same for both BEV and ICE versions in China and many European countries. For much of the world’s population, EVs are on track to achieve purchase-price parity with ICE vehicles by the end of the decade, a more important factor in consumers’ car-buying behavior than TCO. The continuing reduction in battery costs, which constitute around 30% to 40% of an EV’s production costs, contributes to lower ownership costs, as well as greater economies of scale due to the increased production of EVs.

One key factor for EV adoption is range anxiety - the fear or uneasiness that drivers might experience regarding the possibility of running out of battery power before they are able to reach a charging station or their destination. With the improvements in battery technology and charging networks, the impact of range anxiety has lessened, although it continues to be relevant for potential EV users especially if their travel behavior includes longer distances and areas with limited charging accessibility. With this in mind, access to private charging, switching to higher range 400-500 km EVs and the continuous improvement of public charging stations is essential for improving EV readiness.

Public charging networks have the potential to enhance EV readiness through three crucial dimensions: density of chargers to reduce the distance between charging points, speed to charge to reduce the time needed to wait for a charge to be completed, and the quantity of the charging points to reduce the waiting time for an available charger. As the adoption of EVs increases, the expansion of charging infrastructure becomes essential to guarantee a charger's consistent availability, thereby mitigating any impact on EV penetration.

This is us!

The rental market can support broader electrification goals, by providing an easy way for consumers to experience EVs before they commit to buy; many customers will have their first EV experience in a rental car. Corporate accounts are prioritizing EV rentals, due to their alignment to their own Environmental, Social, and Governance (ESG) objectives. According to Kayak’s Travel Trends 2023, searches for electric car rentals increased 136% year-over-year.

Among car rental companies, Hertz is the most outspoken about its EV objectives, declaring that they own the biggest electric fleet in the world outside China. Hertz has committed to purchase more than 340,00 EVs within the next 5 years from GM, Tesla, and Polestar with the overarching goal to build up one-quarter of its fleet with EVs by the end of 2024.

Meanwhile, Europcar, a French-based company, pledged to make 20% of its fleet electric or low-emission hybrid by 2024, up from the 3% owned in March 2022, which means it will need to buy up to 70,000 cleaner vehicles in the coming two years.

Expanding our EV offering has been, and will continue to be, a journey. We know our destination – the world’s largest EV operator – but it will take time and investment to get there.

Operationally, EVs bring a new set of complexities, especially around charging. We need to ensure we have the infrastructure in place to charge vehicles between rentals and deliver a well-charged car every time. This also requires the ability to monitor charge state and battery health in the same way we monitor fuel levels and engine health on ICE cars today.

Many of our customers will be driving an EV for the first time, and we want to support and educate them to make their trip as seamless as possible. We’re developing customer resources to explain the unique characteristics of EVs, and offering charging solutions to customers while cars are on rent.

We began this journey in early 2022, offering a handful of Teslas to our subscription customers. Launching our EV Daily Rental product in LA this September is a big milestone, but there are many more to come - expanding our EV fleet to more markets, offering a wider selection of EV vehicle classes, and ultimately becoming an EV-first operator. There will be lots to learn and improve upon along the way, and we’re excited to be taking the next step!

If you are ready to take on the wheel of an electric future, starting from September 1st, you can be among the first to experience our exciting EV fleet in LA. Whether you're cruising down the Pacific Coast Highway or exploring the Hollywood Hills, our EV fleet is designed to help you unlock the freedom to go places. If you’re ready to know more about our EV fleet, take a moment to explore our comprehensive FAQs section, where we've covered everything you need to know about charging, driving, and more.

Let's unlock the freedom to go places together!