Cars and Drivers

Avis, Hertz Deals With Google and Apple Ratchet Up Self-Driving Competition

John Harrington

Published: June 27, 2017 8:37 am

Last Updated: January 12, 2020 10:40 am

Avis Budget Group Inc. (NASDAQ: CAR) and Hertz Global Holdings Inc. (NYSE: HTZ) jumped into the self-driving sector as the car-rental companies forged deals with Google Inc. and Apple Inc., respectively, intensifying the competition in the emerging autonomous vehicle sector.

Parsippany, N.J.-based Avis Avis said Monday that it signed an agreement with Waymo, a division of Google parent Alphabet Inc., to offer fleet support and maintenance services for Waymo’s self-driving car program at Avis Car Rental and Budget Car Rental locations. This is the first announced deal between a rental-car company and businesses that are involved in self-driving vehicles.

The collaboration is intended to support Waymo’s growing autonomous vehicle fleet and Waymo’s early rider program. Waymo recently announced that it is adding hundreds of Chrysler Pacifica minivans to build a 600-vehicle fleet.

Under the multi-year agreement, Avis will modify selected rental facilities to offer automotive services and secure parking for Waymo’s fleet.

“Not only does this partnership enable us to leverage our current capabilities and assets, but it also allows us to accelerate our knowledge and hands-on experience in an emerging area as Waymo-enabled self-driving cars become available in the marketplace,” said Larry De Shon, president and chief executive officer of Avis, in a statement.

Avis also owns the car-sharing company Zipcar. Waymo has a separate agreement with ride-sharing company Lyft.

News reports say Apple will work with  Hertz, based in Estero, Florida, on a small group of self-driving vehicles. Sources told CNBC that Apple, which has been reluctant to provide details in its interest in self-driving cars, is leasing six cars from a Hertz subsidiary for autonomous software testing.

Neither company was commenting on the report about their partnership.

Apple Chief Executive Officer Tim Cook is a believer in the future of self-driving cars and called autonomous vehicles “the mother of all AI projects.’’

The California Department of Motor Vehicles says Apple has three vehicles registered under the autonomous driving permit, all of them 2015 Lexus RX crossovers.

Avis’ stock climbed 14% Monday and in pre-market trading Tuesday had added 1.2%. Hertz gained 13.5% Monday and came back to earth Tuesday, as its shares were little changed.

Even with Monday’s jolt of positive news, the shares of both car-rental companies are down this year. Through Monday, Hertz shares were down 51% and Avis’ stock is off 26% in 2017..

California is awash with companies seeking to test autonomous vehicles. As of June 15,the state’s DMV has issued autonomous vehicle testing permits to 34 companies, including for all of the major U.S. car makers.

California requires companies that want to test autonomous vehicles on the roads to register for an autonomous driving permit.

The autonomous vehicles testing regulations were adopted on May 19, 2014 and became effective on Sept. 16, 2014.