Rental car company Hertz Global Holdings and General Motors recently reached an agreement. Hertz plans to order as many as 175,000 electric vehicles from General Motors over the next five years.

Hertz is reported to be ordering electric vehicles from GM's Chevrolet, Buick, GMC, Cadillac, and BrightDrop brands. GM and Hertz said the deal between the two companies will "cover a variety of vehicle models, including compact and midsize SUVs, as well as pickups and luxury models." The first orders will be for Chevrolet Bolts, which are expected to start early next year, the report said.

Hertz estimates that over the term of the agreement, its customers can drive more than 8 billion miles in these electric vehicles, which will reduce carbon dioxide emissions equivalent to about 3.5 million tons compared to similar gasoline-powered vehicles.

GM Chairman and CEO Mary Barra said in a statement: "Our partnership with Hertz is a huge step forward in reducing emissions and adopting electric vehicles, which will help GM create thousands of new pure electric vehicle customers." GM plans to reach an annual production capacity of 1 million electric vehicles in North America by 2025.

For automakers, orders from rental car companies ease the challenges faced by traditional automakers during the transition period. It's a try-before-you-buy situation, said Steve Carlisle, president of GM North America. He hopes that consumers will be more inclined to choose an electric car when buying a car because they have driven an electric car when renting a car.

Jeff Nieman, Hertz's senior vice president of operations planning, said the acquisition was "in the multi-billion dollar range." The company deploys electric vehicles across its entire business network, prioritizing cities such as Los Angeles, San Francisco, Miami, and Orlando.

Hertz is aiming for electric vehicles to make up 25 percent of its fleet by the end of 2024. Other rental car companies, like Avis and Enterprise, are following suit, saying they are aiming to expand their EV presence.

But the deal isn't Hertz's first move to add zero-emission models. Hertz said in April it would buy up to 65,000 electric cars from Swedish electric car maker Polestar over the next five years. In October 2021, Hertz announced a $4.2 billion purchase of 100,000 electric vehicles from Tesla, most of which are Model 3 models.