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Alphabet Will Test Its Autonomous Rentals Cars At Avis Locations In Phoenix, Arizona

The car rental company Avis has reached an agreement to manage Alphabet’s self-driving vehicle unit. The two companies are looking to become a leader in an industry that has endless potential. Expected to be worth billions in the near future, the autonomous car industry has only begun to scratch its surface on the streets.

Alphabet Partnership

The deal dictates that the rental car company will use Waymo’s Chrysler Pacifica minivans on a trial basis. The city of Phoenix, Arizona will be the first location for the autonomous service. While Avis controls the fleet’s distribution, Waymo will still own the vehicles. A critical detail in the agreement is that the deal is not exclusive, meaning other companies can vie for the services of Waymo’s self-driving cars.

The agreement will likely be the first in a long line between rental car companies and the emerging autonomous industry. After the partnership was announced, shares of several rental providers rose significantly. Avis’ stock jumped 21 percent following the news. Companies will eagerly monitor Avis’ success in the Phoenix market. In total, Avis has received 600 self-driving vehicles courtesy of Waymo.

Waymo's Next Move

Reports have linked Waymo to Zipcar, a subsidiary of Avis. Acquired by the rental provider in 2013, Zipcar is a car-sharing enterprise. The app could help promote Waymo’s partnership with Avis to an even larger audience. Experts will not be surprised to eventually see Zipcar included in the first of a kind collaboration.

The deal comes at an ideal time for Avis. The company has seen sales slip recently, reporting a two percent dip in their first quarter of the year. In addition to the autonomous cars, Avis offers a variety of high-end vehicles in its fleet. This includes the BMW X3, Chevrolet Corvette Coupe, and Lincoln Navigator among others. Financial terms of the deal between Alphabet and Avis were not released.