Car sharing programme launched in London

At centre stage in Hertz’s launch of its car sharing service in London, Paris and New York was a cherry red Mini Cooper convertible, symbolising a dramatic foray into this market by a traditional rental car company to date.

As has been done by other car sharing companies, Hertz will place its vehicles in strategic urban locations and make them available to its members by online reservation. The new programme, called “Connect by Hertz,” charges for car rental by the hour, and requires the payment of an annual membership fee which covers gas, insurance, maintenance, roadside assistance and a key card that can be used to access all vehicles.

Hertz’s entry into the car sharing market comes as the rental car industry is facing a number of challenges. Airlines have cut capacity, meaning fewer rental customers at airports, and consumers are cutting back on leisure and business travel. These changes in the rental market have meant significant drops in both rental revenues and profits.

Mark Frissora, the chairman and chief executive of Hertz, commented that the company’s timing in entering the car sharing market could not have been better. By starting small, he indicated, Hertz is looking to begin addressing consumer demands for alternatives to owning cars and also to capitalize on the weakness of its rental car competitors.

“People can’t buy cars today,” said Frissora in an interview, in referring to the current credit crunch.

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