As millions of Americans prepare for the Labor Day weekend, some rental car companies are implementing artificial intelligence scanners to detect vehicle damage. This new technology has raised concerns among consumers and lawmakers alike, as it may lead to unexpected repair costs and fees.

Adam Foley and his wife recently rented a car from Hertz during a family trip to Atlanta. Upon returning to San Antonio, Foley received automated messages from Hertz claiming that damages were found on the vehicle. The messages indicated he owed $80 for two small dents and an additional $190 processing fee, totaling $350 for what he described as "negligible events that I didn't even detect."

Foley expressed his frustration in a LinkedIn post, stating, "As a consumer, it feels pretty extortive." The damages were identified using AI-powered photo booths that capture thousands of high-resolution images of vehicles before and after rentals. The technology is provided by UVeye, a software company based in New Jersey.

Hertz is currently using this system at 10 U.S. airports and plans to expand its use nationwide. The company stated that the previous manual inspection process was often "subjective and inconsistent," leading to confusion and frustration among customers. In a statement, Hertz emphasized that digital inspections introduce "precision, objectivity, and transparency" to the process, aiming to ensure customers are not charged for damages that did not occur during their rental.

After reviewing Foley's case, Hertz waived his damage costs, stating, "We strive to get it right for every customer - and when we fall short, we work to make it right."

Concerns about the technology's fairness have prompted responses from lawmakers. Democratic Senator Richard Blumenthal of Connecticut has requested answers from Hertz's CEO regarding the use of this technology and the reasonableness of the fees charged to consumers. Similarly, Republican Representative Nancy Mace of South Carolina has sent a letter to Hertz seeking clarification on the matter.

Consumer advocate Lindsay Owens noted that while such technology can simplify processes, it can also lead to overcharging customers. "We've seen cases where customers have disputed the damage because they think it's a shadow and not actually a dent or a scratch or a mark," she said.

Hertz declined to provide an interview but reiterated that the UVeye system offers precision and objectivity, enhancing customer confidence. UVeye reported that its inspection systems are currently used to scan millions of vehicles monthly at various locations, including dealerships and service centers.

Other rental companies are also exploring AI technology. Sixt confirmed its use of the technology at select locations, while Avis stated that its damage assessment process remains "human-led." Enterprise Mobility indicated that it does not use this technology.

The UVeye scanners are designed to detect varying levels of damage based on client specifications. The company claims that its technology reduces the need for manual inspections, increases vehicle safety, and provides a reliable record of vehicle condition.

According to Hertz, over 675,000 rentals have been scanned so far, with more than 97% showing no billable damage. A recent rental by a CBS News crew at Phoenix Sky Harbor Airport revealed that the company did not proactively inform them about the AI system in use. When inquired, the crew could not view the "before" images of the car and did not receive a bill for any damage.

Foley, who advises companies on AI technology, expressed that he would have chosen a different rental company had he known about the AI inspections. He added that he felt relieved to have received his money back, stating, "I think that without national news coverage, the charges would still be standing today. It shouldn't take the amount of publicity I received following my post to be treated like a valued customer."