Tesla Model 3 sedans outside a Hertz rental office. Courtesy Uber

Uber said Wednesday it is launching a new partnership with rental car company Hertz to offer 50,000 Tesla vehicles as a rental option for its rideshare drivers by 2023.

Uber drivers can rent a Tesla through Hertz starting on Nov. 1 in San Diego, Los Angeles, San Francisco, and Washington, DC, with the program expanding to other cities nationwide later this year, the company said in a blog post.

The announcement comes after Hertz on Monday said it would order 100,000 Tesla vehicles by the end of 2022, meaning that half of the rental company’s Tesla fleet could be used by rideshare drivers.

For Uber drivers, Tesla rentals will start at $334 a week, including insurance and maintenance, and consist mostly of the company’s Model 3 sedan. Uber said the rental cost would drop to $299 per week or lower as the program expands in the coming year.

Uber said renting would be a “win-win” for its drivers who don’t own cars, pointing to savings on gasoline costs and higher earnings potential under the company’s Green Future Program, which provides incentives of $1 more per trip up to $4,000 annually.

Wednesday’s deal represents Uber’s most significant step so far in expanding the use of EVs on its platform. The company has vowed to operate only electric vehicles on its United States, Canadian and European platform by 2030, and worldwide by 2040.

But only a few ride-hail drivers can afford the higher EV sticker prices and in 2019, only 0.15% of all Uber miles in the United States and Canada were driven in electric vehicles, company data showed.

“This is the largest expansion of electric vehicles on a mobility platform in North America and one of the largest globally, marking another step towards Uber’s zero-emissions goal,” the company said.

Rideshare drivers produce more pollution per passenger mile traveled because they spend more than a third of their time driving around empty. Researchers generally assume that electrifying one rideshare vehicle reduces the same amount of CO2 as converting three regular gas-powered vehicles.

Hertz, which is emerging from bankruptcy, hopes the EV focus will allow the once-dominant brand to stand out against competitors.

Reuters contributed to this article.

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Chris Jennewein

Chris Jennewein is Editor & Publisher of Times of San Diego.