Car Rental Experience Is Being Reshaped With Connected, Electric Cars

As travel for business and pleasure pick up and customers return to car rental companies, they’re being greeted with new technology.

For example, Hertz is rolling out several technology initiatives, some of which will be visible to customers while others will be behind the scenes.

“The journey to improve our technology is underway,” Hertz Global Holdings CEO Stephen Scherr said Wednesday (April 27) during the company’s quarterly earnings call. “From the use of mobile phones to the deployment of telematics to the incorporation of artificial intelligence, Hertz will be in a better position to serve our customers, to price our assets and to manage our business.”

Providing a Seamless Digital Experience 

For one thing, the company will have nearly its entire North American fleet equipped with telematics by the end of the year. Hertz is also addressing its core technology stack, its systems architecture and its app.

“As we enter the summer peak season, we have already initiated enhancements to the customer experience,” Scherr said. “Our objective is to provide customers with a seamless digital experience every step of the way — in short, to take the hassle out of renting a car.”

This begins with the app, which will be reimagined, but also includes other technology. Hertz has pilot programs currently underway to field test touchless exit gate and rental experiences. The company is also running a pilot to move its insurance replacement business from a heavily paper-based system to a digital platform.

In addition, the company has partnered with Amazon Web Services to modernize and digitize the customer experience and its new mobility platform, with Oracle on the upgrade of its back-end systems and with Stripe on improvements to its payment systems.

Helping Corporate Customers Satisfy Carbon Footprint Objectives 

Electric vehicles (EVs) are also a growing part of the mix, as Hertz now has EVs deployed across 30 markets and says a considerable portion of its fleet will be electric by year-end.

The company has expanded its Tesla rental offering to more than 20 markets and has partnered with Polestar to bring 65,000 of its EVs into the fleet. Scherr said during the call he would like to see more than 30% of the Hertz fleet being electric by the end of 2024.

The company has found that EVs cost less to operate and command higher prices than internal combustion engine (ICE) vehicles.

“In the context of corporate, there’s an interesting developing phenomenon, which is that the electric vehicle is turning out to be a great appeal to our corporate customer,” Scherr said. “They need to rent cars to their employees, but they’re equally, through EV, satisfying their own ESG and carbon footprint objectives.”

The company’s EV partnership with Uber continues to grow and now stretches across 30 markets in the U.S.

“The utilization rates we are seeing on this portion of the fleet are well over 80%, and we continue to experience strong driver demand, supported by the increased earnings these drivers can generate by renting from Hertz rather than outright ownership,” Scherr said.

A growing number of customers will be experiencing these moves to connected, electric cars as Hertz reported that March was the first month since the onset of the pandemic in which revenue exceeded its 2019 level.

“We are seeing that momentum continue into April,” Scherr said.