Hertz's New AI Scanner Sparks Controversy Over Damage Charges

New Hertz AI scanner charged one car renter $440 for a 1-inch tire scuff

How to save money on car insurance This app can help save you money on car insurance. ProblemSolved, USA TODAY Car rental company Hertz has begun using AI scanners to check vehicles upon return for damage and in the case of at least one renter, the technology may have gone too far. One renter who returned his Thrifty rental vehicle, which is part of the Hertz Corporation, to the Hartsfield-Jackson Atlanta International Airport was charged $440 for a 1-inch scuff discovered on a tire by the AI scanner, according to a report by The Drive. The renter received a message on the Hertz app within minutes of returning his vehicle, but was unable to speak to a human about the charges. How is Hertz using AI? In April, Hertz said it would be "transforming its vehicle maintenance process" by partnering with UVeye, to introduce advanced AI inspection to its U.S. operations. In a press release at the time, Hertz said by implementing the advanced AI-driven inspection technology, "Hertz can significantly enhance the frequency, accuracy, and efficiency of its vehicle maintenance processes, ensuring reliable service, improved vehicle availability and transparency for its customers." The AI-powered camera systems and machine learning algorithms enable real-time, automated inspections of a vehicle's body, glass, tires and undercarriage, the company said. Hertz said it was starting its rollout at the Atlanta airport and expanding to major U.S. airports by the end of the year. What happened with the $440 charge to the renter? The renter contacted The Drive to relay his experience with the new AI scanner. He was alerted to damage for a 1-inch scuff on the driver's side rear wheel. The bill? $250 for repair, $125 for processing and a $65 administrative fee, all totaling $440. The renter could pay right away, or get a $52 discount if paid within two days or $32.50 discount if paid within a week. But since he couldn't get past the chatbot system and was not aware he could flag the claim to request a human agent review it, he reached out through the "contact us" link and had to wait 10 days for a response. He told The Drive's Adam Ismail that he was not planning on paying the bill within the seven days to get the discount. In a follow-up email, Ismail told USA TODAY that he had not heard any update from the renter. In a statement to USA TODAY, a Hertz spokesperson said "Over 97% of cars scanned with this technology show no billable damage, proving that the vast majority of rentals are incident-free. Vehicle damage has long been a common pain point across the car rental industry for customers and companies alike. At Hertz, we're using this technology to tackle this head-on." The goal, the company spokesperson said, is to ensure customers are not charged for damage they didn't incur, "while bringing greater transparency, precision, and speed to the process when new damage is detected. As we continue rolling out this technology, we remain committed to ongoing innovation and continuous improvement." When a customer flags an issue in the dedicated chat, live agents review the flagged damage issues and their determination is communicated via the AI agent, the spokesperson said. The company is also working on integrating live agents into the app. "With regards to this specific incident, a live agent reviewed this customer's escalation and manually reviewed the photos at pickup and return and confirmed the damage was new," the spokesperson said. "While we understand that some customers may hope for a different outcome, we want to ensure every case is handled fairly and objectively, using the best information available." Professor: Hertz's AI technology parameters may need to be reconfigured There can and should be advantages to a business using AI, such as not engaging humans and human time to evaluate a problem, said Ramnath Chellappa, professor of information systems and operations management at Emory University's Goizueta Business School. Among Chellappa's areas of expertise is AI. But in this case with Hertz, Chellappa said he found it quite odd and defeating the purpose if it increased the cost to a consumer. Given that often rental companies will have a rule of thumb for when damage or a scratch is considered significant enough for a charge, Chellappa said it seems the parameters of the AI used by Hertz may need to be adjusted. "I don't think the problem here is the technology...I think the problem is in the policy they're implementing," Chellappa said told USA TODAY. "Sometimes we have a tendency to kind of use technologies and blame all the necessary outcomes on it," said Chellappa. "But this is clearly a case of whether the firm in question has the right policy in terms of what it is going to do with the results from the AI rather than the AI itself." Betty Lin-Fisher is a consumer reporter for USA TODAY. Reach her at [email protected] or follow her on X, Facebook or Instagram @blinfisher and @blinfisher.bsky.social on Bluesky. Sign up for our free The Daily Money newsletter, which will include consumer news on Fridays, here.

Hertz car rentals could get a lot more expensive

Just like everything else from groceries to apartments these days, car rentals are much more expensive then they used to be. In the last decade, the price of a car rental has gone up by 29.2%, per data from Nerdwallet. Although they're not as high as they were in 2021, the year after the pandemic, you can still expect to fork out a chunk of cash if you're in need of a rental. Don't miss the move: Subscribe to TheStreet's free daily newsletter Where you rent the car also matters when it comes to how much you'll have to spend. Miami was the best deal as of 2024 ($377.07 for a week-long rental) among cities with large, heavily traveled airports, while New York, Chicago, and Seattle had the highest rates ($590-$624). Consumers who are used to renting cars on work trips or who travel frequently for leisure will be all too familiar with the process of having the vehicle photographed before and after to document its condition in case it's damaged during the rental duration. Related: Hertz absorbed a massive loss after electric vehicle fire sale Now, Hertz (HTZ) is introducing a new documentation process that will be less time-consuming, which seems like a boon for the consumer and the rental company alike. But according to some customers, it can also come with an unexpected new fee that could add hundreds to your bill. Hertz's new scanner system Earlier this year, Hertz partnered with an Israeli tech company called UVeye to introduce a new way to check the condition of car rentals when they depart and return to the rental lot. The system is called Digital Vehicle Inspection (DVI) and uses AI technology to capture the data. Hertz says it enhances the rental experience by providing clear, detailed documentation of the vehicle condition. The customer is then able to view before and after photos taken via an app. That all sounds like it would be a time-saver - but some Hertz customers report being charged additional fees for small defects that they deem unfair. According to a customer who rented a car from Hertz at the Atlanta airport and spoke with The Drive, the DVI detected a one-inch scuff on the driver's side rear wheel when he returned the vehicle. Within minutes, the customer was slapped with a charge: $250 for the repair, $125 for processing, and another $65 administrative fee, totaling $440. Related: Dave Ramsey has blunt words for Americans buying a car The customer was also notified that he could get a $52 discount on the fee if he agreed to the terms and paid within two days, or a $32.50 discount if he paid within a week. When he tried to speak to a customer service agent, he was redirected to a chatbot. While Hertz gave a statement to The Drive saying that "the vast majority of rentals are incident-free," the company did not answer when asked whether damage-related fees are higher when renting vehicles from Hertz stores that use UVeye scanners versus ones that don't. Will other rental companies use the system? Hertz is aiming to implement the scanners at 100 of its roughly 1,600 U.S. airport locations by the end of 2025. Hertz also owns several other rental car companies, including Thrifty, Dollar, and Firefly. TheStreet has reached out to Hertz to find out if the DVI will be used at these as well. UVeye revealed the partnership with Hertz in April 2025, saying, "Hertz is setting a new standard for vehicle maintenance and fleet management in the rental industry, and we're thrilled to partner with them," said UVeye CEO Amir Hever. Hertz has also drawn past customer criticism for its practices. In 2022, the rental car company faced claims that it falsely accused 364 people of stealing its vehicles. Some of the accused were arrested, charged with felony, and in some cases served time in prison. In December 2022, Hertz announced it would pay $168 million to settle the claims. Hertz has also faced other struggles. In the last four years, the car rental company has been through five different CEOs. It also filed Chapter 11 bankruptcy in May 2020, but re-emerged in June 2021 after a restructuring process. Related: Amazon aims to crush Elon Musk's Robotaxi

Hertz customers outraged over AI-powered scanner that charges...

Hertz customers are complaining they were charged hundreds of dollars for minor scrapes and dents that were detected by the rental car giant's new artificial intelligence-powered scanner -- with little recourse to dispute the charges. Patrick, a customer who rented a Volkswagen from Hertz-owned Thrifty at Hertz's Atlanta airport location -- its first US store to implement UVeye tech -- told The Drive that he received a bill "minutes" after returning the car. Hertz demanded that Patrick cough up $440 for a one-inch scuff on one of the car's wheels. The fee included $250 for the repair, $125 for "processing" and $65 for "administration." When Patrick logged into the Hertz web app, he was shown photographic proof of the damage that was flagged by UVeye scanners. He told The Drive that he was offered a discount -- $52 off if he paid within two days, or $32.50 off if he paid within a week. But Patrick held off. "Saving $30 to accept responsibility is not worth it," he told The Drive. When Patrick tried to take up the matter with a live customer service rep, he found the challenge to be quite daunting. Customers are directed to a web portal where they can view before-and-after photos captured by the scanners. But if they have concerns, their options are limited. A chatbot can flag the issue for review, but there's no live agent to talk to. Emailing support is possible, but responses can take up to 10 days -- well after the early-payment discount expires, according to Patrick. One frustrated Reddit user, posting under the handle professor_pimpcain, shared a similar experience after returning a car to Hertz's Atlanta location. "It automatically sent me a bill for this 'ding'. $195," they wrote. "I will no longer be using Hertz. Reached out to customer service and they said they stand by the AI." Many complaints center on the lack of transparency around how fees are calculated. While Hertz says the processing fee covers "the cost to detect and estimate the damage" and the administrative fee "covers a portion of the costs [Hertz incurs] as a result of processing your claim," these explanations have struck customers as vague -- especially when they have no way to challenge the charges in real time. In a statement to The Drive, Hertz defended the system, saying: "The vast majority of rentals are incident-free. When damage does occur, our goal is to enhance the rental experience by bringing greater transparency, precision, and speed to the process." Yet some customers see it differently. They say the AI system seems designed to maximize revenue, not fairness. The technology's ability to instantly generate fees -- with no human interaction and a short window for discounts -- feels less like transparency and more like pressure. One Reddit user responding to professor_pimpcain wrote last week: "Wow that's insane! Never using hertz ever again." Earlier this year, Hertz announced that it was partnering with UVeye, an Israel-based firm that specializes in rapid, automated car inspections that have been described as an "MRI for vehicles." By year's end, Hertz says it will have more than 100 of UVeye's AI-powered scanners operating at US airport locations. These machines perform full-body vehicle scans in seconds, detecting damage such as dents, scrapes and cracked glass both before and after a rental. While Hertz is the only major rental company using the system extensively, UVeye's technology is already well-established in other automotive sectors, with clients like General Motors, Hyundai, Amazon and CarMax. The company's inspection systems are in use at hundreds of dealerships, fleet locations and vehicle auctions worldwide. UVeye has also worked with GM and Connexion Mobility to inspect cars at dealerships during service appointments, but not in traditional rental contexts. UVeye is reportedly in talks with additional rental agencies, suggesting broader adoption may be on the horizon. Hertz has faced controversy before. In recent years, the company has been criticized for billing electric vehicle renters for gasoline due to a "systems error" and for charging one customer $10,000 for mileage on an "unlimited-mile" rental. In 2022, five customers sued Hertz after being wrongfully arrested for allegedly stealing cars they had, in fact, returned.