Hertz has been in the news lately for a few significant issues, primarily centered around customer disputes and their adoption of new technology. Here is what is going on:
False Arrest Allegations: This has been a long-standing and very serious issue. For several years, Hertz faced numerous lawsuits and public outcry from customers who claimed they were falsely accused of stealing rental cars they had legitimately rented. I was at a loss on why Hertz thought their cars were stolen when they had all the paperwork. This just seemed like a sloppy car management system.
These accusations sometimes led to customers being arrested and even jailed. In December 2022, Hertz announced it would pay $168 million to settle many of these claims. Despite the settlement, reports of false accusations and difficulties in resolving these issues continued into 2023 and 2024, with the new CEO promising to address the problem.
Controversy over AI Damage Scanners (UVeye): More recently, Hertz has introduced AI-powered vehicle inspection systems (developed by UVeye) at some of its airport locations. While intended to improve efficiency and accuracy in detecting vehicle damage, this technology has sparked significant customer frustration. The way it works is that after you return your car, UVeye would scan the car to see any damage that may have occurred during your rental.
Alleged False Damage Claims: Many customers report being charged for minor or barely visible damage that they claim didn’t exist or was pre-existing. The AI system is designed to flag damage as small as one inch, leading to disputes over minuscule dings and scuffs. Also, there have been claims that UVeye has reported damage that turned out to be water spots from the rain. These additional charges has created an uproar with customers renting Hertz’ cars.
Lack of Human Interaction: A major point of contention is the difficulty customers face in disputing these charges. Many report being unable to speak with a human representative, instead being directed to automated systems or apps that offer limited recourse. This has led to feelings of being scammed and pressured to pay unexpected fees.
I would not be surprised if this new system was charging multiple renters for the same alleged damage. I do not know about you but I do not do such a complete check of my rental car before leaving the rental agency. Let alone, I am not performing the AI review like UVeye.
It seems that Hertz does not have a de minimis exemption to their damage review. They could institute a rule that says any damage like a scratch less than an inch will not be charged. This provision is common with car leasing companies. These issues seem to suggest that the bean counters are running the show and they are not interested in the public or customer perception of their product. As Hertz ramps up their penny-pinching approach to assess damage, many of Hertz’ best customers will look at other rental options. When you create significant customer dissatisfaction resulting in a negative public perception for the company, your future may not be so bright. I guess this all depends on whether the other rental car companies follow suit with Hertz’ approach. Let us hope not.