By Aishwarya Jain and Nathan Gomes
April 23 (Reuters) – Early signs of a shift toward electric vehicles have emerged for U.S. car rental companies, as customers become wary of paying more at the pump due to the conflict in the Middle East.
At Hertz, which rents cars to Uber and Lyft drivers on a “longer-term basis than traditional rentals,” requests for electric vehicle reservations rose nearly 25% in March compared to February. The biggest rebound in EV rental demand has been on the West Coast, where gas prices tend to be higher, according to Doria Holbrook, executive vice president of Hertz’s mobility division.
On Turo, a peer-to-peer car rental service similar to the property rental site Airbnb, electric vehicle bookings increased 11% in the last three weeks of March compared to the previous three-week period. On March 31, the day U.S. gas prices surpassed $4 per gallon for the first time since 2022, EV bookings on Turo were 47% higher than the same day in 2025, the company said.
Iran’s war has caused disruption in the Strait of Hormuz along the Iranian coast, through which approximately 20% of the world’s oil and liquefied natural gas passes. Average U.S. gasoline prices have risen by more than a third since the war began on Feb. 28, to $4.02 per gallon, according to the U.S. Energy Information Administration.
STRAIT OF HORMUZ BITE OF DISRUPTIONS
Rising fuel prices don’t typically cause a sudden change in car-buying decisions, analysts and dealers say. But the severity of this price shock has already led many consumers to look for alternatives. In Europe, for example, electric vehicle registrations in 15 countries increased by more than 50% in March.
The effect in the United States has been more moderate. Sales of new electric vehicles fell 25% in March from a year earlier, according to Cox Automotive, as the expiration of a $7,500 tax credit last fall continues to dampen Americans’ appetite for electric vehicles. But sales of used electric vehicles have risen sharply, and car renters seem more willing to make the switch in the short term to save gas.
Car ​Rental Gateway, a digital rental platform, reported a 16% relative increase in electric and hybrid vehicle bookings in March. Rental companies that are betting big on electric cars could benefit if gasoline prices remain high, said Hannes Põldvee, board member of Car Rental Gateway.
PRICES BOUNCE IN THE USED VEHICLE MARKET
Increased demand for electric vehicles has also propped up the price of used electric vehicles. John Coles, vice president of data science and analytics at ACV Auctions, an online platform used by dealers and rental companies to buy and sell used cars, said electric vehicle prices had been declining for months but had firmed after the surge in oil prices that began in early March.