Car rental giant Hertz has been ordered to explain its controversial use of artificial intelligence technology to detect damage and automatically charge customers.

Hertz announced a partnership with tech firm UVeye in April to “modernise vehicle maintenance with AI technology”.

This has seen the company roll out AI-powered vehicle scanners at multiple airports in the United States that conduct 360 scans of rental cars before and after they are used by a customer and detect any potential damage.

“By implementing UVeye’s 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 customer,” the company’s media release said at the time.

According to Hertz, this process involves a rental car being scanned within seconds, and a “digital vehicle inspection” then comparing the before-and-after scans to “clearly and accurately identify any changes”.

Automated damages

The use of this technology and the apparent lack of any human intervention or oversight has led to widespread controversy and anger among customers who say they have been charged for non-existent damage to rental cars and unable to talk directly to a human employee of Hertz.

This includes digital transformation expert Adam Foley, who said he rented a Hertz car last month which was scanned by the AI technology upon exiting the facility and after returning the vehicle.

Two hours after returning the car, Foley said he received a message saying that the system had detected damage to the car in one area.

These were a small ding on the roof of the car, and something on the hood, things that Foley said were “nothing any human would detect or reasonably consider ‘damages’.”

The automated system said that Foley now owed $292 ($US190).

“To protest this fee, it is an automated AI chat experience that does not break to go to a human interaction no matter what choices you make,” Foley posted on LinkedIn.

It wasn't until after 20 automated messages from Hertz threatening to bring about court fees over the course of seven weeks, and several media reports about his predicament, that Foley had his Hertz charge scrapped.

Another Hertz customer posted on Reddit that they were charged for damage detected by the AI system that did not exist.

They said that after returning the car and receiving a message saying there was damage, they went back to inspect it but could see “no visible damage whatsoever”.

“I even recorded a video on the spot to document the condition of the car,” the user posted.

“To make matters worse, no one at the Hertz location could help.

“Employees and managers all pointed fingers at the ‘AI scanner’ and told me to contact customer support - they claimed they had no control over the damage claim.”

A ‘please explain’ from Congress

The incidents have now caught the attention of US Congress, with the US House Subcommittee on Cybersecurity, Information Technology and Government Innovation writing to Hertz CEO Gil West demanding more information on the AI-powered scanners and how they are being used.

“Some other car rental companies reportedly use AI as a tool but require human staff to review any damage flagged by the scanning system before billing customers; however, Hertz, is apparently the only rental car company in the US that issues damage assessments to customers without human review,” subcommittee chair Nancy Mace said in the letter.

“The subcommittee seeks your cooperation in understanding Hertz’s plans to ensure that large and small customers alike benefit from the implementation of this new technology.”