Hertz is installing AI inspection portals at its biggest U.S. airports this year. Atlanta was the first, but they expect to hit 100 airports before 2025 is over.
Now they scan cars as they’re being returned – vehicles drive through a camera‑and‑sensor tunnel and get an ‘MRI for vehicles’ to log damage in a way that rental staff never did before. It also finds hard to spot damage such as under the vehicle, uneven tire wear, hairline cracks in the windshield.
We’re seeing one inch scuffs on a rear wheel billed out at $440 ($250 repair cost, $125 “processing” and $65 “administrative fee”).
- That’s the kind of thing that would never have been noticed before.
- And it’s probably not actually even getting repaired.
They ask for payment right away or else you pay more, and if you challenge them it takes longer than the discount window to get a response. They go after you for more money if you question the charges.
- This isn’t about accuracy
- And it isn’t about convenience
- It’s a new way to squeeze customers who don’t expect it.
Hertz’s new system lets them go after 5 times as many customers as before. The rate at which they’re sending out bills is skyrocketing. Here’s the math:
For big U.S. airport car rental locations, between 0.3% and 1% of rentals close out with actual damage charged to the customer. Roughly one renter in every 100‑300 gets a bill for damage. The midpoint most estimate, then, is about 0.6% (or 6 claims per 1,000 rentals).
- About 10% of rental returns may have some fresh dents, scrapes, or glass chips. Most of these, historically, never turned into a customer bill. At high turnover airports the focus is on taking back the car, cleaning it and getting it to the next customer.
- Fewer than 1% of rentals historically have turned into damage claims, Meanwhile, 30% – 50% of those claims are ultimately written off.
In contrast, according to Hertz, “fewer than 3 percent of vehicles scanned by the A.I. system show any billable damage.” (Emphasis mine.)
That means Hertz’s new system is billing out damage at about 5 times the previous rate. And this destroys the value proposition of renting from them (assuming of course that there was one to start with).
Historically renting from Hertz (or Avis or National) at an airport location meant on-airport convenience and going straight to your car rather than standing in long lines, and that they didn’t nickel and dime you over minor nicks and scrapes.
You pay a ton of extra fees for airport rentals, and frequently higher rates than off-airport discounters, but you weren’t stressed or hassled. These businesses are high volume and high revenue and they didn’t hassle over minor damage the customer probably didn’t do to the vehicle themselves.
It’s always been advisable to take photos and videos of vehicles prior to renting, it usually didn’t matter when renting from major car rental companies at major airports. That’s clearly changing at Hertz and others will likely follow.
The implication, though, is that these companies will no longer be worth their premium. There was an implicit loss damage waiver being purchased even by customers not paying for extra coverage. By stripping that feature out, but charging the same price, the customer gets less and becomes incentived to book elsewere – the Fox, Payless or Advantages of the world.
@ Gary — I doubt we will ever rent a car again.
This has really gotten out of control.
First they call the cops on you. Now they nickel and dime you. What an operation….
I’m going to guess this will not end well for Hertz if they can’t supply full images of your car as you leave their parking lot. Otherwise there is nothing to compare the current situation to.
And based on Hertz disdain for its customers, would you trust them?
Uneven tire wear? Get the hell out. That’s why one is supposed to rotate their tires — on a FWD vehicle the front tires will wear faster (and on RWD, the rear wheels.)
After Hertz’s previous issues of falsely claiming cars they rented were stolen (and not helping to clear things up with the police when they realized they’d made a mistake), and charging for a tank of gas on returned Teslas (and, again, showing unwillingness to just take the charge off when people pointed out the Tesla they rented didn’t burn gas… and I’ll note, they weren’t just listing the electricity as ‘gas’, they were ALSO charging for the electricity to charge it up…)… well, I’d never rent at a Hertz anyway but this gives yet another reason not to.
When a $45 LDW is the only way to avoid a $450 junk charge for damage that may not even be repaired, it stops being insurance and starts looking like a high-margin profit strategy.
Really appreciate your work. The COMMENTS also allow me to continue to remind people NOT to fly American Airlines and NOT to rent from Hertz. Yes, others fail, but not as badly as these two.
At what point will CC rental insurance push back? Or will credit cards strip that from us as well?
So interesting that at one major chain I saw a measuring card where any new scratch or dent was ignored if it was smaller than the template sizer. And at others they’ve just said anything less than x size is nothing to worry about. I am curious what size scratch will get caught, it isn’t clear from the articles. In Europe we once were stopped for undercarriage scratches (which we didn’t create) but managed to get it removed. Maybe this pushes me more to local neighborhood locations where they won’t install fancy scanners? Does the AI give you enough documentation to file credit card LDW insurance claim?
Don’t these car rental agencies write off the depreciation on the vehicles when they go to sell them? This seems like double billing. They shouldn’t get the benefit of both practices.
Thank you, Hertz, for making car rental decisions easier – no more Hertz for me, or any other member of my family.
– former Hertz Five Star member
“You pay a ton of extra fees for airport rentals”
So true! Recent 2-day rental of an economy car at Logan cost$216, of which $148 was actual rental charge, the rest – fees (most of which I didn’t ask for, approve or will benefit). Ridiculous!
Lets call it was it is, an outright scam to get more money from the customer, this is really going to hurt Hertz reputation (which was not great as it is) Word is going to get around fast about this and it is going to really hurt them in the long run.
“Resort Fees,” only for rental cars.
Gimme the excruciating Enterprise walk-around every time. I make a point of pointing out tiny flaws so I don’t get penalized on return.
After all horror stories of Hertz sending customers to jail for no customer fault whatsoever, I was trying to avoid Hertz at all costs, even so I supposedly have high status with them thru my cards. Unless they become customer friendly, openly, I would never rent from Hertz even for free.
……
They should avail this service to the customer at time of pick up. Give a copy of the report to the customer and then it shoujd be compared with report generated on return. Customer must sign off on the comparison report. Else reports can be tweaked and the customer is not getting level playing field
Last year, I rented from Hertz. They used to be my go to rental company. When I returned the car, I asked for a physical receipt. I assumed that they would also send me an email receipt. I got the paper receipt. I kept on waiting for the email receipt; No rental was shown on the rental history; And no charge showed up on my credit card. I was getting really worried that they might accuse me of something. Over two weeks later, the rental actually showed up and my credit card was charged. I breathed a sigh of relief. However, it left a bad taste in my mouth, and I have been avoiding renting from them since.
Also, more than once, I have returned a car to Hertz at the airport, no representatives are there check the car back in. There was a sign to leave the keys in the car and they will check it in later. No choice, but to leave the car or wait and miss my flight. Not good.
Keep receipts i see a class action lawsuit coming. I’ve always wondered why we haven’t seen one for gas charges. I’ve received multiple rentals that left the lot without full tanks. That means they took money to fill it but didn’t. Im guessing taking money to repair the vehicle but not fixing the damage is going to fall into the same boat.
Hertz in Germany has been this way for 20 years so I never use Hertz in Germany.
Once they accused me of damage of a tiny scratch but then saw it was already on their sheet.
Sounds more like criminal fraud ! Info, a pre-rental scan, should be provided to the renters at the time of the rental ! Plus minor damage is to be expected & part of the risk a rental company assumes !
Just returned a rental to Alamo today and was grateful that they and others haven’t implemented this yet; that said, I returned a rental to Sixt in Europe recently, and they used the ‘drive through 100 cameras’ thing, which presumably uses AI, yet no ‘surprise bill’ yet. Or, maybe it’s like Florence, where they send you a summons in the snail mail nearly a year later for driving 6 inches in a bus lane, threatening to take you to collections over €55.
I don’t care as long as AI also inspected before I rented. “A copy of the pre-rental inspection sheet, please.”
Document all damage before you rent. Unfortunately most parking garages are dark and it’s easy to overlook damage.
Good old Hertz. I was Hertz Gold (or whatever level I had) for quite a few years. Happy to say I have not rented with Hertz for at least 5 years.
I already wasn’t renting from Hertz because they still haven’t fixed the problem of having their customers arrested. This is one more reason to put them on my personal “do not rent” list.
Can the customer obtain request that a copy of the AI report be given to them on their phone before departing the airport rental location so that they have something to compare when they get a report upon return of the vehicle?
It’s time for you to report on what percentage of Rental Car damage claims the credit card companies refuse to cover, and if there are variations between the brands. Long term I think they may reduce or eliminate this benefit, but I’m curious if those of us who charge their Hertz rental say on a Chase credit card are relatively safe from these charges?
Huck Fertz for doing this. Unfortunately, it indeed seems others are following suit. Avis at LAX (inside the new rental facility) has a massive camera array equipped with lighting at the exit. Seems that unless customers truly revolt over this, it will soon be adapted as a standard industry practice.