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How IoT is Disrupting the Rental Car Industry

In 2017, the U.S. car rental market reached roughly $28.6 billion in total revenue, achieving the first year-over-year revenue per unit per month growth in four years. Whether it’s travelers coming for a U.S. visit, or drivers needing a temporary vehicle, there are many reasons why the rental car business continues to boom. As with many other business categories, IoT is disrupting the rental car industry.

IoT is improving the rental car process for drivers, as well as revolutionizing legacy or pen-and-paper systems for rental managers. Regarding driver benefits, virtual keys are among the top. Instead of waiting in line to pick-up car keys, drivers can use their connected phone or device to unlock, lock, and start the rental car. This feature also means no losing a set of keys and getting locked out, since there are no physical keys to keep track of when renting. Thanks to connected devices, companies like Zipcar are utilizing this key-less, short-term rental option without any hassle.

cars in a parking lot iot is disrupting the rental car industry

Rental car workers can use IoT technologies to monitor the car’s fuel level and odometer, eliminating the pen-and-paper process when customers return the automobiles. Alternatively, IoT platforms can help locate any vehicle in real-time, which is especially useful if the car is not returned to the proper location. Rental car company employees won’t have to hunt down cars or even be in the vehicle to monitor its use, and drivers can find out about any additional charges quickly.

On a larger scale, the IoT will help rental car companies understand how customers use their cars. Companies can track GPS locations to find out more about why people rent their vehicles. This data can also help improve mapping for future use. Since the IoT provides real-time data, rental companies could deliver more targeted ads to local restaurants or tourist events as well.

Global car rental company, Hertz, has been eager to put the IoT to use in its business vehicles. Hertz offers a 24/7 hourly rental service for businesses, which includes keyless cars that can be booked online, by phone, or on the app. Hertz has partnered with retail stores across Europe so that customers who make physically large purchases can rent a car by the hour to bring their items home, an added convenience for shoppers.

Next up for the rental industry is including personalization with IoT through connected apps. Also, some companies have noted their push for more voice activation services, as well as in-car travel planning. For now, the IoT is making renting a car a seamless experience for drivers, who no longer have to wait in long lines to get on the road. And for managers who are ready for a technological upgrade, the IoT provides just that.


Auto Rental News, 2017 U.S. Car Rental Market Reaches $28.6 Billion (, December 13, 2017.

Case Study: IoT is redefining the customer experience. Nokia case study.

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