SAP Drops Tesla From Company Fleet Over Price Volatility

SAP, Europe’s largest software company, will no longer include Tesla vehicles in its company car fleet. The decision to remove Tesla from their list of eligible company vehicles was mainly attributed to Tesla’s unpredictable delivery schedules and frequent price adjustments.

According to a report by the German publication Handelsbatt, SAP’s fleet manager, Steffen Krautwasser, highlighted the difficulties in planning and the heightened financial risk posed by Tesla’s inconsistent pricing strategy, which diverges markedly from the more stable list prices of other manufacturers. (via Reuters)

This unpredictability, while understandable from Tesla’s perspective as it seeks to remain competitive and stimulate demand, presents a significant problem for SAP. The company, with a fleet of 29,000 vehicles, seeks predictability and stability in managing its assets.

This move by SAP is part of a broader trend where companies, including major rental firms like Hertz and Sixt, are reconsidering their commitments to Tesla due to the automaker’s aggressive price cuts. These reductions, aimed at boosting sales, have inadvertently impacted the resale value of Tesla vehicles, thereby increasing the financial risks for fleet owners.

Hertz, for example, has pointed to lower than expected demand for EVs and higher repair costs as additional challenges, leading to a strategic shift back towards internal combustion engine (ICE) vehicles to improve its financial outlook.

Tesla’s frequent price adjustments have been a double-edged sword. While beneficial for new consumers, they have complicated fleet management and investment recovery for corporate clients.

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