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Can Hertz Outrun Zipcar in Hourly Car Rentals?

Long a leader in daily car rentals, Hertz hopes to overwhelm the hourly rental upstart
Hertz will soon boost ads for its On Demand hourly rental service, which uses Horatio as its online mascot
Hertz will soon boost ads for its On Demand hourly rental service, which uses Horatio as its online mascot

When one of Mark Frissora’s sons was a student at Harvard University almost a decade ago, he became a devoted customer of niche car rental firm Zipcar. The fact that his father was named chief executive officer at Hertz Global Holdings in 2006 didn’t keep the youngster from singing the praises of the quirky company, which appealed to young, urban dwellers who didn’t own wheels but occasionally used their laptops to rent autos by the hour. The elder Frissora was listening. He later considered buying fast-growing Zipcar, he says, before deciding Hertz should build its own hourly rental brand.

If all goes according to plan, by the middle of next year he’ll have Hertz’s entire 375,000-vehicle U.S. fleet equipped with devices that let customers use a computer or smartphone to reserve and unlock a rental car from the Hertz On Demand service. (It started in 2008 as Connect by Hertz before being rebranded last year.) That’s more than 30 times the size of Zipcar’s current fleet. “The difference between us and Zipcar is, frankly, the scale,” Frissora says. “A good example is New York. I’ve heard them say they have 2,000 cars there. Well, we have 35,000. When I have them all enabled with Hertz On Demand, they have a real problem.”