Is Hertz Using AI To Rip You Off?

Issue #131

Happy Saturday!

Renting a car is almost always a headache, but Hertz just made it a bit more complicated. Today, we discuss how the company uses AI and how it could be very expensive for you!

Market News

• Nissan pauses production on these three models sold in Canada.

• Honda sells more of this GM product than GM.

• A record number of buyers paid more than $1,000 a month for their car payments. Here’s more on this.

• This company says nobody wants manual transmissions anymore. Do you agree?

• Here’s how automakers rush to sell EVs before tax credits end.

• Ferrari fans wanted a manual transmission. Here’s what the Italian company said.

• Ford’s employee pricing had worked, but the company has changed it to this.

• This new heavy-duty truck has Ford and Chevy worried. And, if not, they should be.

• Here is Hyundai’s latest EV and many consider it a Tesla killer.

•  The new Mazda CX-5 is out now, so what happens with the CX-50? Here’s what Mazda says.

Safety and Recalls

• Ford recalls 850,000 vehicles for this critical issue. 

• Speaking of Ford, it broke a record nobody should own. Here’s what happened.

• This owner has had her car at the dealership since January because of one recall.

Car Culture

• Toyota’s secret GT car raced at Goodwood. Here’s more on it.

• Here’s a tribute to America’s first hybrid (20 years ago!) and how good it was.

• This legendary car website is gone. RIP.

• Range Rover just changed its logo. Here it is. What do you think?

• The third-gen Camaro wasn’t loved, but this transformation sure rocks.

• You really, really, really have to want this Land Cruiser to buy it.

• Maserati launches a new sports car, but wait. There’s something off about it.

• Mazda is the latest to backtrack on this, and now promises changes.

• No, Chevy won’t do this to the Corvette.

• This VW model went from hype to flop. Here’s what happened.

Video Of The Week

The new GR86 looks promising, but Throttle House shows us an even more exciting version.

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In The Know

Hertz Uses AI To Rip You Off?

Hertz is in hot waters, yet again. Understanding why is essential to you as a customer, we need to examine car renting in general and the company itself. 

Renting a car can be as wild an experience as going gambling. As this article so eloquently puts it, renting a car is the great equalizer. 

As much as new platforms have tried to change the car renting experience, it's still an adventure filled with risk. Turo is one of the latest platforms to "Airbnbize" car rentals. We discussed its troubles here. 

Car renting is a tricky business, I'll say that, and staying on top requires creativity (good and evil). 

Hertz is such a case. It has existed since 1918 and has always looked to innovate.

It created the first charge card, the first airport location, and many other "firsts" in the industry. 

In the 1960s, Hertz famously partnered with Carroll Shelby to create the "Rent-a-Racer" program.

Shelby had convinced the company to buy 1,001 modified Mustangs so that traveling salespeople could fulfill their dreams of racing, all the while working. Here's more on that fascinating story. 

During the 1980s and 1990s, Hertz was also at the forefront of the industry by catering to customers' needs.

They rode the wave of what was popular: if people wanted minivans, Hertz gave them minivans. If customers wanted to rent a car for a day, Hertz also offered that option. 

The 2010s, however, were plagued by bad decisions. For one, the CEO at the time, Mark Frissora, decided to hold onto the fleet for longer than usual.

This was a gamble, but it made some financial sense. The cars were cheaper and depreciated, so the numbers on the accounting books were great, but maintaining the fleet was expensive. 

Then, in 2017, incoming CEO Kathryn Marinello did what seemed obvious: she crunched the numbers and decided to replace the fleet. But there was a problem. 

To do so, she chose sedans in an age where the SUV was king. The reason? Sedans were cheaper. 

Here's how that decision blew up in their faces when the company went bankrupt in 2020 due to the pandemic (and other reasons).

They managed to survive, as this article explains, thanks to investors, a bailout, and luck.

Then, in 2024, the company was desperate to sell off most of its electric fleet because, well, they were EVs, and nobody wanted them. Here's how desperate the company is.

However, business decisions aside, it's how Hertz has treated its customers lately that has landed the company in hot waters. The company offers unlimited miles, but it ended up charging a customer $10,000 because he drove too much. 

Here's more on that crazy story and what happened next.

The latest move is using AI to discover damages in your car. This may seem like a brilliant move for the company, as it enables automated scanning.

The problem is that it can pick up dings and scratches that even Hertz employees may not have spotted. Then, it charges a crazy amount for them. 

This article dives deeper into the situation.

So, in the end, is this situation about Hertz?

Not really. It's bound to happen with other rental car companies (it's already happening), and it leaves the customer powerless.

How can you debate with AI? It's almost impossible. So, be ready for the next time you rent a car.