Hertz Greens Car Rentals, Adds EVs to Car Sharing Fleet

Last Updated Apr 30, 2010 1:26 PM EDT

This is not your grandmother's Hertz Rent-a-Car (HTZ). Today, Hertz, still the world's largest general-use car rental brand with 8,100 outlets in 147 countries, is planning to offer electric Nissan Leafs. It is also moving aggressively into car sharing, including plans to sign on entire New York City buildings.

"Let Hertz put you in the driver's seat," the company said in the 1960s ads that showed Mom and a suit-and-hat-wearing Dad dropping into a '64 Chevy convertible. In those days, innovation meant offering a revolving credit plan that "give you up to 20 months to pay" for a rental. It was Avis, number two, that tried harder.

In many ways, car rental is maturing, with car sharing probably the fastest growing form -- helped in no small measure by the green image it enjoys for taking cars off the road. Working with a membership model, car-sharing services proudly offer testimonials from customers who've given up their cars after becoming car sharers. Car sharing grew by 117 percent between 2007 and 2009, reports Gas 2.0, and there could be 5.5 million car sharers in Europe and 4.4 million in North America by 2016.

Here's the old model, Hertz in the 1960s:

Hertz, a subsidiary of Ford (F) from 1994 to 2005, was sold to a private equity group that took it public in 2006. Without Ford as a big daddy, it no longer has a house brand and rents many different cars.

These days, Hertz is aggressively going green. Hertz' lots now offer the "Green Collection," featuring Nissan Altimas and Toyota Priuses. You can ask for them by name, which is not possible with its other "small," "medium" and "large" cars. In 2008, it launched an initiative to reduce energy use at its North American and European locations, and that same year became the first rental car company to endorse a series of climate policy recommendations for G8 leaders.

According to spokeswoman Paula Rivera, Hertz hopes to have the Leaf battery car (with 100-mile range) in the fleet late this year, though she admitted many of the details -- such as how the cars will be charged, and which company will provide charging stations -- have yet to be worked out.

Hertz' Connect car-sharing operation was launched in 2008, and it is international, in New York, London, Paris, Madrid, Berlin and on 35 college campuses (mostly in the U.S.). New York is a major hub, with 400 cars in 100 locations.

Connect is positioned to compete directly against Zipcar, its chief rival, which is also expanding rapidly both in the U.S. and Europe. Connect works much the same way as Zipcar, though it has sought to differentiate with some services borrowed from Hertz itself, such as a "NeverLost" in-car navigation system.

"EVs are appealing as part of car sharing," Rivera said. "Our analysis shows that most people use car sharing for only one or two hours at a time, and only within a certain radius that is within where the battery can take you."

The company has relations with two New York apartment buildings, including Seward Park on the Lower East Side and Silver Towers in midtown. Hertz likes apartment buildings for car sharing because cities like New York offer many barriers to actual car ownership, but residential complexes have dedicated parking spots and a captive audience. The company is working with MyBuilding.org to spread the word to tenants.

Connect currently has 13,000 members worldwide. Rivera says she expects the business to grow, because Connect can benefit from economies of scale in purchasing fleets along with larger Hertz orders. Another help, she said, is that Hertz owns proprietary technology to help manage those fleets and book car-sharing sessions.