Democratic House candidate Jack Schlossberg is urging the Federal Trade Commission to investigate potential overcharging practices by rental car companies using artificial intelligence technology.
NEW YORK, N.Y. — As thousands of New Yorkers prepare for Memorial Day and summer travel, Democratic House candidate Jack Schlossberg is calling for an investigation into how rental car companies are utilizing artificial intelligence (AI). Schlossberg, the grandson of former President John F. Kennedy, has raised concerns about reports that Hertz began employing AI technology last year to scan vehicles for rental damages, warning that this practice could lead to consumers being overcharged.
“AI is being used in consumer-facing financial products, and Hertz is using AI to scan for microscopic damage on cars, invisible to the human eye, to charge people with fees for damage that they might not even be aware of,” Schlossberg stated outside a Hertz location in midtown Manhattan. “They have no opportunity to dispute, and the FTC should act here to investigate whether or not this constitutes an unfair trade practice.”
Schlossberg’s concerns are partly based on a report from The Drive, which detailed an incident involving a Hertz customer. After returning a rental vehicle, the customer was informed that a 1-inch scuff on the driver’s side rear wheel resulted in a $440 charge. This fee included $250 for repairs, $125 for processing, and a $65 administrative fee. The situation reportedly worsened when the customer attempted to dispute the charges; the company’s chatbot did not provide an option to connect with a live representative, instead routing the issue for later review.
Hertz has partnered with Israel-based Uveye to implement AI scanning technology at airport locations over the past year. This technology uses cameras and machine learning algorithms to inspect returned vehicles, aiming to enhance the frequency, accuracy, and efficiency of the inspection process while reducing the need for manual checks, according to Car & Driver.
In response to these developments, Schlossberg is urging the FTC to take four specific actions. He has stated that if elected to Congress from New York’s 12th Congressional District, he would work to establish these measures into federal law. The proposed actions include conducting a thorough investigation into Hertz’s use of AI for damage detection, assessing whether this practice constitutes an unfair or deceptive act under federal law, creating clear guidelines for the use of AI in consumer-facing financial decisions, and ensuring that consumers have a transparent, fair, and accessible process to dispute charges.
“I think that this is a harbinger of what’s to come,” Schlossberg remarked. “This is the new frontier of corporate fine print because AI is being used in ways we couldn’t imagine to price gouge, price fix, jack up prices on consumers without their consent, and basically just squeeze every nickel and dime out of consumers that they possibly can. And sometimes this can be unfair.”
Schlossberg’s campaign emphasized that “innovation must not come at the expense of the consumer,” highlighting the need for regulatory oversight in the rapidly evolving landscape of AI technology.
A spokesperson for Hertz responded to Schlossberg’s concerns, asserting that digital vehicle inspections bring “precision and transparency” to a historically inconsistent process. The company claims that this technology protects customers from being charged for damages that did not occur during their rental and allows for faster, fairer resolutions when disputes arise.
“Since launching over one year ago, we’ve been listening, learning, and improving based on customer feedback,” the spokesperson stated. “We’re committed to building upon the progress we’ve made to continue providing our customers with a more consistent rental experience and safer fleet.” The company further clarified that customers are not charged for damages that are invisible to the human eye and that they receive comprehensive reports, including before-and-after photos, which can be discussed with a Customer Care team via email, phone, or chat.
Schlossberg’s announcement, made in mid-April, aims to “get ahead of the peak season booking” as New Yorkers plan their Memorial Day weekend trips. He hopes to raise awareness about the potential pitfalls of renting a car amid the rise of AI technology.
The Federal Trade Commission has declined to comment on the matter.
Schlossberg is competing in a crowded Democratic primary scheduled for June 23 to represent New York’s 12th Congressional District. The winner of this primary is widely believed to have a strong chance of securing victory in the general election, given the district’s heavily Democratic leanings, according to Fox News.