Rising gas costs push US drivers toward electric vehicle rentals

Early indications of a shift toward electric vehicles are emerging among US car rental companies, as consumers grow increasingly sensitive to higher fuel prices linked to the ongoing conflict in the Middle East, Reuters reports.

At Hertz, which provides vehicles to Uber and Lyft drivers on longer-term arrangements than traditional rentals, requests for electric vehicle reservations rose by nearly 25% in March compared with February.

“The strongest uptick in demand for EV rentals has occurred on the West Coast, where gas prices tend to run highest,” said Doria Holbrook, executive vice president of Hertz’s mobility division.

At Turo, a peer-to-peer car-sharing service, EV bookings increased by 11% in the last three weeks of March compared with the previous three-week period. The company added that on March 31—when US gas prices exceeded $4 per gallon for the first time since 2022—EV bookings were 47% higher than on the same day in 2025.

The broader fuel price surge has been linked to disruptions in the Strait of Hormuz along the Iranian coast, a critical transit route for about 20% of global oil and liquefied natural gas. Since the start of the conflict on February 28, average US gasoline prices have risen by more than a third, reaching $4.02 per gallon, according to the US Energy Information Administration.

Analysts note that fuel price spikes typically do not immediately reshape long-term car-buying behavior. However, the severity of the current shock has prompted many consumers to explore alternatives. In Europe, EV registrations across 15 countries increased by more than 50% in March.

In the United States, the impact has been more restrained. Sales of new electric vehicles fell 25% in March year-on-year, according to Cox Automotive, as the expiration of a $7,500 federal tax credit continues to weigh on demand. However, used EV sales have risen significantly, while car renters are increasingly opting for electric models in the short term to reduce fuel costs.

Car Rental Gateway reported a 16% increase in combined EV and hybrid bookings in March. Hannes Põldvee, a board member at the company, said rental firms that invested heavily in electric vehicles could benefit if elevated fuel prices persist.

Rising demand has also supported used EV prices. John Coles, vice president of data science and analytics at ACV Auctions, said electric vehicle prices had been declining for months but stabilized following the early March surge in oil prices.

“We have seen EVs get a second lease on life due to the sustained pressure at the pump,” he said.

By Vafa Guliyeva