Sixt: EV ‘Momentum’ Missing Amid File 2023 Income

Germany-based automobile rental firm Sixt reported 2023 income of greater than €3.6 billion (almost US$4 billion), a rise of 18 % yr over yr and making it the second yr in a row the corporate achieved report income, in accordance with a Friday earnings launch. The income determine is also 45 % larger than the 2019 complete, in accordance with Sixt.

All three of the corporate’s areas made a “robust contribution” to the income development, in accordance with Sixt. Income from its home market of Germany elevated 23.6 % in contrast with 2022 to just about €1.1 billion and accounted for 29.9 % of the 2023 income complete. North American income elevated 18.5 % to just about €1.1 billion, representing 29.7 % of the overall and exceeding €1 billion for the primary time. The European market exterior Germany was up 14.3 % to just about €1.5 billion for 40.4 % of the overall. 

Sixt reported €464.3 million in 2023 earnings earlier than taxes, “the second-best end result within the firm’s historical past,” however that represents a 15.6 lower yr over yr. The corporate additionally expanded its fleet in 2023 to a mean of 169,100 rental automobiles, up 22.2 % yr over yr. 

“Our earnings are all of the extra exceptional contemplating the numerous deterioration in market circumstances for e-mobility over the course of the yr, rising rates of interest and continued excessive ranges of funding,” Sixt co-CEO Alexander Sixt stated in an announcement.

Electrical Car Challenges

The deteriorating market circumstances Sixt referred to incorporate “the severely worsened surroundings for the sale of used electrical automobiles.” The falling residual EV values “led to elevated depreciation and losses from automobile gross sales and thus a damaging impression on earnings within the vary of round €40 million for 2023,” in accordance with the corporate. On the similar time, demand for e-mobility as a complete “has not but developed the momentum desired,” and the decrease demand in contrast with combustion-engine automobiles “resulted in a considerable lack of income.”

Sixt responded with bringing “ahead considerably” the phasing out of electrical danger automobiles—these for which there are not any buyback or leasing agreements. On the finish of February 2024, the proportion of such automobiles within the electrical Sixt fleet was about half as excessive as on March 31, 2023, in accordance with the corporate. Sixt added that EVs will proceed to make up part of the Sixt fleet sooner or later, “nonetheless, additional developments require a excessive diploma of flexibility.”

Sixt’s EV challenges echoed a few of these cited by Hertz throughout its earnings name final month, which adopted the corporate’s resolution to “pause” additional EV purchases from Polestar and its resolution to promote 20,000 EVs within the Americas, or about one-third of its EV fleet.

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