Avis / Budget
Avis and Budget are car rental brands owned by Avis Budget Group, the third-largest rental car company in the United States with approximately 26% market share. The group also owns Payless and Zipcar and, with its licensees, operates about 10,000 rental locations in approximately 180 countries, generating $11.7 billion in revenue in 2025.
Score generated by AI agents based on publicly cited evidence and reviewed by the project maintainer. Not independently validated. Last assessed 2026-09-27. Score revised 2026-09-27: 56 → 53.
Score History
Timeline events are AI-curated from public reporting. Score trajectory is derived from documented events.
Avis Budget Group began trading as a standalone company on September 5, 2006 after Cendant's four-way breakup, with Ronald Nelson as CEO. Fees were already stacking at airports (a 2009 example had taxes and fees adding 42% to a base rate, led by an 11.11% concession recovery fee), and e-Toll convenience fees later challenged in a $45 million class action began in April 2007. The 2008-09 downturn brought about 5,250 job cuts and a smaller fleet, and in 2010 Avis Budget bid against Hertz for Dollar Thrifty.
The January 2013 agreement to buy Zipcar for about $500 million, followed by Payless in July 2013 and the 2011 purchase of Avis Europe, spread Avis Budget across premium, mid-tier, deep-value and car-sharing segments just after Hertz's FTC-cleared Dollar Thrifty deal. By 2014 the three big groups held about 98% of the U.S. market and were raising prices, a consumer group said counter add-ons produced about 10% of rental revenue, and from 2014 the company billed the U.S. government for unallowable supplemental charges. Canada's Competition Bureau challenged Avis and Budget's drip pricing in 2015.
Larry De Shon became CEO on January 1, 2016, and on January 25 a cooperation agreement with largest stockholder SRS Investment Management put SRS partner Brian Choi on the board. Canada fined Avis and Budget C$3 million for unattainable advertised prices in June 2016, Payless allegedly began charging customers for fuel and roadside products they had declined (later settled for $19 million), and government overcharging under the Defense Department agreement ran through 2019. Buybacks reached about $200 million in 2017, and airport concession fees spread to renters who flew in but rented off-airport.
COVID-19 led Avis Budget to lay off or furlough about 21,000 employees, roughly 70% of its workforce, in March 2020 and to cut its average fleet by almost 28%. When demand returned in 2021 into a vehicle shortage, rental prices soared and the company spent about $4.8 billion on buybacks across 2020-2022 plus about $935 million in 2023-2024, leaving SRS with more than 47% of the shares. Legacy cases were settled ($10.1 million False Claims Act, $45 million e-Toll, $33.9 million Florida insurance), while a drip-pricing suit, a fuel double-charge suit, an August 2024 data breach and Italy's fine over fine-handling fees closed out the era.
Avis Budget's February 11, 2025 report of a $1.8 billion 2024 net loss, driven by a $2.3 billion fleet impairment, came with a leadership change: SRS president Jagdeep Pahwa became Executive Chairman and former SRS partner Brian Choi became CEO in July 2025, pledging a 'hard reset' on customer experience. Buybacks stayed paused while a $518 million EV write-down produced a $995 million 2025 loss, cost cuts closed Zipcar's UK business and Boston headquarters, and an April 2026 short squeeze by outside funds ended with a $650 million short-swing settlement paid to the company. Fee practices persisted: Payless's $19 million settlement was approved in December 2025 and Spain fined Avis EUR 1 million in August 2026.
Alternatives
P2P car rental marketplace where you rent directly from private owners, often at lower prices than traditional rental companies with more vehicle variety. Easy switch for most use cases. Insurance options can be confusing and worth reviewing before booking. Availability varies significantly by city.
Ranked highest in J.D. Power's 2025 North America Rental Car Satisfaction Study (734), while Avis and Budget scored below the industry average. Its neighborhood-branch network makes pickup possible away from hectic airport counters. Easy switch for most rentals. Note: Enterprise, National, and Alamo are all owned by Enterprise Holdings, so this is switching within the same concentrated industry.
German rental company with a growing U.S. presence; tied for third in J.D. Power's 2025 North America Rental Car Satisfaction Study (711), ahead of Avis and Budget. Easy switch at airports and major cities where Sixt has locations; coverage is thinner than Avis/Budget outside major urban areas.
Dimensional Breakdown
Summaries below were written by AI agents based on the cited evidence. They are editorial interpretations, not independent research findings.
Dimension History
Timeline (64 events)
Cendant accounting scandal rocks parent company
Cendant Corporation, parent of Avis, disclosed on April 15, 1998 that it had found accounting irregularities at former CUC International units; prosecutors later said the scheme inflated CUC's results by about $500 million. Cendant lost $14 billion in market value in a single day as its shares fell from about $35.63 to $19.06. Cendant agreed in December 1999 to a then-record $2.83 billion shareholder class action settlement, and former Cendant chairman and CUC chief executive Walter Forbes was sentenced in 2007 to 12 years and seven months in prison.
Supreme Court declines review of Avis workplace harassment injunction
The U.S. Supreme Court declined on May 22, 2000 to review Avis Rent-a-Car System v. Aguilar, leaving in place a 1999 California Supreme Court ruling that upheld an injunction barring an Avis employee from using racial epithets against Latino co-workers. Oscar Aguilar and 16 other Latino drivers had sued Avis for employment discrimination over a fellow employee's harassing comments, alleging Avis knew or should have known and did nothing; a jury found for the employees. Justice Clarence Thomas dissented on First Amendment grounds.
Budget files bankruptcy; Cendant agrees to buy it for $107.5M
Budget Group, then the third-largest U.S. car and truck rental company, filed for Chapter 11 bankruptcy protection on July 29, 2002. Cendant, owner of Avis, agreed to acquire nearly all of Budget's assets for $107.5 million in cash, with a Cendant subsidiary assuming about $2.7 billion in vehicle-related debt, putting Avis and Budget under a single corporate parent. Budget continued to operate as a separate brand.
Avis Budget Group formed from Cendant breakup
Cendant Corporation completed its four-way split, spinning off real estate (Realogy), hotels (Wyndham), and selling travel distribution (Travelport to Blackstone for $4.3 billion). The remaining car rental division was renamed Avis Budget Group and began trading on NYSE under ticker CAR.
e-Toll charges later challenged in class action begin (April 2007)
Avis and Budget customers who used the e-Toll electronic toll payment service from April 1, 2007 (March 2, 2009 in Florida, Texas and Colorado) paid e-Toll 'convenience fees' and, in some cases, a toll differential above what the toll processor paid toll authorities. Charges through December 31, 2015 became the subject of a class action alleging the fees were not properly disclosed, which Avis Budget later settled without admitting wrongdoing.
Shift managers sue Avis for unpaid overtime misclassification
Two class action lawsuits were filed against Avis alleging the company misclassified shift managers as supervisory personnel ineligible for overtime pay under the Fair Labor Standards Act. One suit was filed in federal court in Manhattan in 2008 and a parallel lawsuit in New Jersey in 2011. The cases would eventually settle for $7.8 million, revealing systematic underpayment of frontline management staff.
Avis allegedly fails to buy promised liability insurance for Florida renters
Avis Budget allegedly promised in rental contracts to buy a $1 million supplemental liability insurance policy from ACE American Insurance Co. covering non-U.S. citizens who rented in Florida, but failed to secure the coverage. The class period ran from June 12, 2008 to January 1, 2016, and the claims were resolved in a $33.9 million class action settlement in 2022.
Financial crisis drives job cuts and fleet reductions
Under a five-point cost-reduction plan launched in November 2008, Avis Budget Group eliminated about 3,000 positions in late 2008 and about 2,250 more in 2009, and cut the number of vehicles it bought in 2009 by about 15% versus 2008 to keep fleet levels aligned with collapsing rental demand.
Airport concession recovery fees stack onto rental bills
A July 2009 NBC News column documented how taxes and fees added 42% to one airport car rental's base rate, including an 11.11% airport concession recovery fee, a $3.50-per-day customer facility charge and a vehicle licensing fee, all unavoidable without a convenient non-airport location. Rental companies pass the airport's concession charge to renters as a separate line item rather than building it into the advertised base rate.
Avis Budget and Hertz compete for Dollar Thrifty acquisition
Hertz and Dollar Thrifty signed a definitive merger agreement on April 26, 2010 at $41.00 per share in cash and stock. Avis Budget Group answered with a competing offer in September 2010, starting a bidding war under FTC antitrust scrutiny in an airport rental market dominated by Hertz, Dollar Thrifty, Avis Budget and Enterprise. Avis would ultimately drop its bid in September 2011.
Avis Budget acquires Avis Europe for $1 billion
Avis Budget Group completed its acquisition of Avis Europe plc, the independently-owned licensee that had operated Avis and Budget brands across Europe, the Middle East, Africa, and Asia since 1986. The $1 billion deal reunited global brand operations, creating a combined company with $7 billion in annual revenue and locations in approximately 175 countries.
Hertz acquires Dollar Thrifty, cementing oligopoly
The FTC accepted, by a 4-1 vote, a settlement allowing Hertz's $2.3 billion acquisition of Dollar Thrifty on condition that Hertz sell its Advantage Rent A Car business and 29 Dollar Thrifty on-airport locations; the FTC complaint alleged the original deal would have harmed competition at 72 airports. Avis Budget had competed for Dollar Thrifty but dropped its bid in September 2011. The FTC said Hertz, Dollar Thrifty, Avis Budget and Enterprise together held about 98% of U.S. airport car rentals, so the deal left three firms; Commissioner Rosch dissented, citing the risk of post-merger coordination.
Avis Budget acquires Zipcar for $500 million
Avis Budget Group purchased car-sharing pioneer Zipcar for $12.25 per share (a 49% premium), totaling approximately $500 million in cash. Zipcar had 760,000 members but had never turned an annual profit. The acquisition brought the largest car-sharing disruptor under traditional rental industry control, with Avis citing $50-70 million in expected synergies from shared fleet management.
Avis Budget acquires Payless Car Rental
Avis Budget Group acquired Payless Car Rental, the sixth-largest car rental company in North America, for approximately $50 million in cash. Payless added approximately 120 locations and gave ABG a 'deep-value' brand alongside premium Avis and mid-tier Budget. Payless would later become the subject of a $19 million class action settlement for charging customers for products they explicitly declined.
SeaTac airport shuttle drivers join Teamsters
Shuttle drivers at Seattle-Tacoma International Airport, working as contractors for GCA Services Group under an Avis Budget contract, voted 91-44 in favor of Teamsters Local 117 representation. The 160-worker bargaining unit, predominantly Somali immigrants, had been paid minimum wage with no benefits. The union campaign was part of a broader SeaTac coalition pushing for a $15 minimum wage.
Alleged government overcharging on DoD-managed rental agreement begins
The government alleged that from January 1, 2014 through December 31, 2019, Avis Budget Group billed the U.S., under an agreement managed by the Department of Defense Travel Management Office, for unallowable supplemental charges including collision/loss damage waivers, supplemental liability coverage, personal accident insurance and late turn-in fees, some already included in the government rate. Avis Budget paid $10.1 million in 2021 to settle the allegations with no determination of liability.
Counter add-ons a key rental profit source, consumer group says
Jack Gillis of the Consumer Federation of America told Marketplace that rental companies push for profits through add-ons, with about 10% of revenue coming from car seats, fuel, insurance and GPS sold at the counter through convenience or a hard sell, and said there is 'virtually no reason' for renters who have their own auto policy to buy the counter insurance.
Rental car oligopoly raising prices as three firms control 98%
The Truth About Cars, citing Bloomberg, reported that Avis Budget, Enterprise and Hertz, which together control 98% of the U.S. rental car industry, had been able to raise prices thanks to consolidation and better inventory management. Avis Budget's CEO told analysts he was 'more enthusiastic about our business than I've ever been,' citing 'the meaningful change in pricing' over six quarters. The article noted Avis's purchases of Payless and Zipcar and Hertz's absorption of Dollar Thrifty.
Class action targets Avis and Budget traffic-infraction admin fees
Dawn Valli et al. v. Avis Budget Group was filed in September 2014 in the U.S. District Court for New Jersey, alleging misrepresentations and omissions about charging renters for traffic infractions and related administrative fees since September 30, 2008. In October 2023 the court denied a nationwide class but certified a subclass of Avis Preferred and Budget Fastbreak members, and in February 2026 plaintiffs agreed to limit the class period to September 2008 through April 2016.
Canada Competition Bureau investigates Avis/Budget drip pricing
The Canadian Competition Bureau filed an application with the Competition Tribunal alleging Avis and Budget engaged in false or misleading advertising through drip pricing. The investigation found that advertised prices on websites, mobile apps, emails, newspaper ads, and TV commercials were unattainable because mandatory fees were only disclosed at the time of booking.
FCRA background check class action filed against Avis
Angela Fuller filed a Fair Credit Reporting Act class action against Avis Budget Car Rental in the District of New Jersey, alleging improper background screening practices including failure to provide adverse action notices and reliance on a 1985 citation that should have been excluded from her background report under the statute. The suit would cover approximately 45,000 applicants and settle for $2.7 million in 2017.
SRS cooperation agreement puts hedge fund partner on Avis board
Avis Budget Group signed a cooperation agreement with SRS Investment Management, its largest stockholder, under which SRS partner Brian Choi joined the board and its compensation committee in January 2016 and SRS recommended a second, independent director; SRS agreed to vote for the company's nominees. The agreement came weeks after Larry De Shon succeeded Ronald Nelson as CEO on January 1, 2016.
Canada fines Avis/Budget C$3M for drip pricing
Avis and Budget agreed to pay C$3 million in administrative monetary penalties to the Canadian Competition Bureau for advertising unattainable prices due to mandatory fees disclosed only at booking. The penalties covered deceptive pricing on websites, mobile apps, emails, newspaper ads, and television commercials. Avis and Budget had proactively changed advertising materials in July 2015 but penalties were still assessed.
Payless exposed for adding charges customers declined
Consumer advocacy site Mouse Print documented complaints that Payless Car Rental (an Avis Budget subsidiary) crammed charges such as optional insurance and roadside assistance onto bills after customers declined them, misrepresented optional insurance as required, and pre-charged cards for fuel without automatically reversing the charge. A class action over the practices had been filed the previous month.
Avis settles FCRA background check lawsuit for $2.7 million
Avis moved for final approval of a $2.7 million class action settlement in Fuller v. Avis Budget Car Rental (D.N.J.), resolving FCRA claims over background screening of about 45,000 job applicants, with cash payments of $20 to $695 per class member. At the November 28, 2017 hearing Judge Kevin McNulty granted final approval, and a December 15, 2017 order approved $890,815.20 in attorney fees and costs.
Avis Budget continues share buybacks under 2013 program
Avis Budget Group repurchased about 6.1 million shares for roughly $200 million in 2017 under a stock repurchase program first approved in 2013 and expanded in 2016. Buybacks would accelerate sharply in 2021-2022, when pandemic-era pricing produced record profits.
Connected fleet telematics deployed across 50,000 vehicles
I.D. Systems announced that Avis Budget Group had begun installing its Unified Telematics Platform in U.S. Avis vehicles and would install 50,000 units in total. The device plugs into each vehicle's OBD port, monitors the vehicle and passes operational data and controls to the Avis app, letting renters choose or swap cars, view agreements and lock or unlock the car from a phone; Avis targeted a fully connected fleet by 2020.
Avis expands connected fleet with 75,000 additional telematics units
Avis Budget Group ordered 75,000 more in-vehicle telematics units from I.D. Systems, building on 50,000 deployed over the prior year, for about 125,000 connected vehicles. The system permits two-way data communication between each vehicle and Avis Budget's cloud platform, supporting real-time inventory counts, mileage management, automated maintenance notifications and tracking of idle vehicles.
Avis Preferred members can earn airline miles and hotel points
A 2019 guide to Avis Preferred documented that members can earn airline miles or hotel points (American, British Airways, Etihad and others) on rentals instead of Avis points, and that some airline elites and Priority Pass members receive Avis Preferred Plus or President's Club status. Such cross-program ties add a modest switching cost for frequent travelers.
Airport concession clauses prohibit customer diversion to off-site
A Washington Post travel column reported that airport concession agreements contain clauses barring rental companies from diverting airport customers' business to off-airport locations without counting it in the concession's gross revenue. A Salt Lake City airport spokeswoman said the clause exists to prevent diversion to off-airport locations and that rental companies at the airport asked for it; similar clauses exist in Broward County (FL), Fresno (CA), Philadelphia and San Francisco.
Airport concession fees extended to off-airport renters
The same column reported that airports were charging concession fees to renters who flew in even when they rented off-airport; a downtown Salt Lake City renter was told he would owe an 11% fee if he had arrived by air, and Orlando had decreed that rental companies within a seven-mile radius of its airport must charge a 10 percent gross receipts fee to customers who arrived at the airport within 24 hours of pickup. An Avis location in San Diego posted a sign saying an airport concession fee would be collected from customers who had flown in within 12 hours of pickup, which the renter said was not disclosed on Avis.com or in his confirmation.
Joe Ferraro becomes interim CEO as De Shon departs
The board appointed Joseph Ferraro, President of the Americas and a company veteran since 1979, as interim President and CEO effective January 1, 2020, following Larry De Shon's departure at year-end 2019. Ferraro received a guaranteed $750,000 supplemental cash payment plus $250,000 in restricted stock units for each month as interim CEO.
ACRA lobbies to regulate peer-to-peer rental competitors
The American Car Rental Association, the industry trade group that counts Avis Budget Group among its members, published its position that peer-to-peer platforms like Turo must comply with the same insurance, liability, recall, consumer-protection, tax and airport-fee rules as traditional rental companies, with a timeline of airport and government actions against P2P rentals from 2013 to 2019, including cease-and-desist letters from Miami, Boston Logan, Dallas/Fort Worth and Phoenix airports.
Avis Budget furloughs 21,000 workers amid COVID collapse
Avis Budget Group laid off or furloughed approximately 21,000 employees, about 70% of its workforce, as COVID-19 cratered travel demand. April 2020 revenue was trending down 80% year-over-year, and the company projected operational cash burn of $400 million in April, $250 million in May and $150 million in June. It aggressively disposed of vehicles and expected its June fleet to be more than 20% smaller than a year earlier.
Rental car shortage as industry sold 770,000 cars in 2020
The Washington Post reported that major rental companies sold more than 770,000 cars in 2020 (per Jefferies), leaving more than one in three pre-pandemic rental cars out of service, while a semiconductor shortage slowed restocking. Avis cut its average fleet to 440,000 by the end of 2020, almost 28% smaller than in the first quarter, and booked $157 million in gains on vehicle sales. Customers faced higher prices and longer waits as demand returned, while Avis stock closed at an all-time high.
ABG pays $10.1M False Claims Act settlement for government overcharging
Avis Budget Group agreed to pay $10.1 million to settle False Claims Act allegations for systematically overcharging the U.S. government on DoD rental vehicles from January 2014 through December 2019. The company had billed for unallowable supplemental charges including collision damage waiver, supplemental liability coverage, and personal accident insurance that were already included in the government rate.
Avis stock more than doubles in meme-like short squeeze
Avis Budget shares closed up 108% at $357.17 on November 2, 2021, their biggest one-day gain on record, after touching $545.11 intraday, as retail traders piled into the heavily shorted stock following third-quarter earnings of $10.74 per share versus the $6.52 analysts expected. S3 Partners put short sellers' mark-to-market losses at $4.29 billion at a price of $481.50. Avis repurchased about $1.4 billion of stock in 2021, the start of roughly $5.8 billion in buybacks through 2024.
E-toll hidden fees class action settled for $45 million
Avis Budget Group agreed to pay $45 million to settle a class action, filed in 2011 and certified in 2017, alleging customers were automatically enrolled in e-Toll and charged convenience fees (then $2.50 per day, up to $10 per week) without adequate disclosure. The settlement covered e-Toll charges from April 2007 through December 2015; Avis Budget denied wrongdoing. Under the court-authorized notice, claimants were to be reimbursed 80% of e-Toll-related charges on their first two covered rentals and 65% on their third through seventh.
$33.9M settlement over promised liability insurance
Avis Budget agreed to a $33.9 million class action settlement resolving claims that it promised in rental contracts to buy a $1 million supplemental liability insurance policy from ACE American Insurance Co. for non-U.S. citizens renting in Florida but failed to secure it. The class covered rentals from June 12, 2008 through January 1, 2016; a final approval hearing was set for November 10, 2022.
Avis Budget executes $3.33 billion in stock buybacks
Avis Budget Group completed $3.33 billion in share repurchases during 2022, the largest single-year buyback in the company's history. This came during a period of historically elevated rental car pricing driven by pandemic-era supply constraints, effectively converting windfall revenue from high consumer prices into shareholder returns rather than fleet investment or workforce restoration.
NY Attorney General fines ABG $275,000 for denying debit card rentals
New York Attorney General Letitia James secured $275,000 from Avis Budget Group after investigators found 74 Avis and Budget locations across New York illegally denied car rentals to consumers who could not provide a credit card, violating state law that requires acceptance of debit cards with holds or cash deposits. The company was required to update employee training and provide compliance reports.
Zipcar receives first-ever NHTSA fine for renting recalled vehicles
NHTSA fined Zipcar (an Avis Budget subsidiary) $300,000 for renting vehicles with open, unrepaired recalls, the agency's first enforcement action against a rental car company over recalls. Half the penalty was paid up front and $150,000 was deferred pending future compliance. Zipcar said the matter concerned a 2017 recall in which fewer than 50 vehicles in its 12,000-vehicle global fleet were found in violation.
Class action alleges double-charging for fuel service
The Livingston v. Avis Budget Group class action (D.N.J.) alleged that customers who chose the 'Self-Service' fuel option and returned cars full were still charged a fuel service charge, forcing them to pay for fuel twice, and that Avis and Budget concealed the charge by not providing printed receipts at return.
Italy fines Avis Budget Italia over fine-handling fees
Italy's competition authority (AGCM) fined six car rental companies, including Avis Budget Italia, more than EUR 18 million in total for contract clauses charging renters a lump-sum fee to handle each traffic, parking or toll fine, charged automatically to the renter's card. The authority found the fee unjustified, since rental firms only have to pass the renter's identity to the authority, and ordered the clauses removed.
Avis data breach exposes nearly 300,000 customers
An unauthorized third party accessed one of Avis's business applications between August 3 and 6, 2024, obtaining names, addresses, dates of birth, driver's license numbers and financial information including card numbers. Avis began notifying close to 300,000 people in September 2024 and offered a year of credit monitoring.
Travelers United sues Avis and Budget over drip pricing
Nonprofit Travelers United filed lawsuits against Avis and Budget in D.C. Superior Court under the D.C. Consumer Protection Procedures Act, alleging 'drip pricing' and 'bait and switch' advertising: the companies advertise one price, then add mandatory 'service fees' late in the transaction that raise the total cost of a rental by more than 10%.
Avis Preferred loyalty program enhanced with more tiers
Avis Budget Group enhanced its Avis Preferred loyalty program with additional benefits and rewards across three tiers: Preferred, Preferred Plus (10 rentals or $4,000/year), and President's Club (20 rentals or $6,000/year). The expanded program deepens switching costs through counter bypass privileges, complimentary upgrades, and 25-50% bonus points at higher tiers, while cross-program partnerships with airlines and hotels create multi-ecosystem lock-in.
FTC junk fees rule leaves out car rentals
The FTC finalized its Rule on Unfair or Deceptive Fees but limited it to live-event tickets and short-term lodging. The initial proposal would have applied across the economy, including car rental companies, restaurants and food delivery, so car rentals are not covered by the final rule's all-in pricing requirements.
$2.3B fleet impairment drives $1.8B net loss, CEO departs
Avis Budget Group reported a $1.8 billion net loss for 2024, driven by a $2.3 billion non-cash fleet impairment charge after the company accelerated fleet rotations, shortening the useful life of most vehicles in the Americas segment. CEO Joseph Ferraro announced his transition to board advisor effective June 30, 2025, with Chief Transformation Officer Brian Choi named as successor. The impairment suggested years of deferred fleet rotation while capital was directed toward $5.8 billion in stock buybacks.
SRS president becomes Executive Chairman; ex-SRS partner named CEO
Jagdeep Pahwa, President of largest shareholder SRS Investment Management, became Executive Chairman on March 1, 2025. The board had named Brian Choi, a former SRS partner who served on the Avis board from 2016 to 2020 and then as CFO and Chief Transformation Officer, as CEO effective July 1, 2025, with base salary rising to $1.0 million and a 150% bonus target.
Securities class action filed over fleet impairment disclosure
A shareholder filed a securities class action in the District of New Jersey against Avis Budget Group and certain officers, alleging they failed to disclose a plan to significantly accelerate fleet rotations in Q4 2024 that shortened vehicle useful lives and led to billions in impairment charges. The class period covers February 16, 2024 through February 10, 2025, with claims under Sections 10(b) and 20(a) of the Securities Exchange Act; Pomerantz announced the filing on June 10, 2025.
Payless pays $19M settlement for unauthorized add-on charges
Avis Budget subsidiary Payless Car Rental agreed to pay $19 million to settle a class action alleging it charged customers for Gas Service Option and Roadside Protection fees even when customers explicitly declined those products. The settlement covered rentals from January 2016 through November 2023. Payless agreed to update its sales process to require affirmative consent before charging for add-on products.
Fleet-impairment securities suit dropped
Rather than file an amended complaint, co-lead plaintiffs in the consolidated securities class action over Avis Budget's 2024 fleet strategy disclosures dismissed the case without prejudice on October 13, 2025, and the court closed it on October 16. Plaintiffs in two related derivative suits agreed to dismiss them on October 23, subject to court approval.
CEO pledges 'hard reset' on customer experience
On the Q3 2025 earnings call, CEO Brian Choi, who took over in July 2025, announced 'a hard reset on customer experience,' saying 'We try harder' is in the company's DNA but 'during the survival years of Covid, we drifted from that bedrock principle.' Weeks earlier, J.D. Power's 2025 rental car satisfaction study had ranked Avis and Budget below the industry average of 691, with Enterprise top at 734.
Viral TikTok exposes gap between advertised and actual rental prices
TikTok user Taylor Rowe posted that she booked an Avis economy car at $27.53 per day for a four-day rental but was charged $495.98; her itemized receipt showed $88.99 per additional day plus other charges and 10.2% tax. Motor1 noted the video came as Avis subsidiary Payless faced a $19 million class action settlement over ancillary fees.
Zipcar to shut its UK car-sharing business
Zipcar, owned by Avis Budget Group, said it proposed to cease all UK operations by the end of 2025, subject to consultation with its 71 UK employees, and stopped accepting new member applications.
Payless $19M add-on settlement wins final approval
The $19 million settlement resolving claims that Payless Car Rental and Avis Budget Group charged renters for Gas Service Option and Roadside Protection products they had declined received final approval on December 9, 2025. Class members who rented from January 2016 to November 2023 get up to $20 per rental for fuel-option charges and up to $12 for roadside charges, paid automatically; the companies denied wrongdoing.
Court dismisses derivative suit over buybacks and SRS influence
A federal judge in New Jersey dismissed a derivative complaint alleging insider trading on fleet-delivery delays and that directors let share buybacks give a large minority stockholder control of Avis Budget. The judge found demand futility was not pleaded, rejected the claim that the stockholder controlled the company, and called the buyback program a valid exercise of business judgment.
Zipcar Boston headquarters closed, 126 workers laid off
Avis Budget Group said it would close Zipcar's Boston headquarters and lay off 126 employees, including 65 in the Boston area, moving Zipcar's corporate operations to Avis's Parsippany, N.J., offices. Regional field and fleet teams remain in Boston and the Zipcar service continues. The move came 13 years after Avis bought Zipcar and followed Zipcar's 2025 exit from the U.K. market.
$518M EV write-down drives $995M loss for 2025; buybacks stay paused
Avis Budget reported a 2025 net loss of $995 million on $11.7 billion of revenue, including $518 million of impairment and related charges after shortening the useful life of certain U.S. electric rental vehicles, and a fourth-quarter net loss of $856 million. It sold EVs to a joint venture for $183 million in tax-credit proceeds, and its annual report showed no share repurchases in 2025, after about $935 million in 2023-2024.
Short squeeze sends Avis shares up about 600%, then collapses
After hedge fund Pentwater Capital disclosed a large position, Avis Budget shares climbed about 600% from late-March lows to a record close above $713, then fell more than 70% over two days as the squeeze unwound, with trading halted repeatedly. Bloomberg data showed SRS controlling more than 49% of the company and Pentwater about 20%, and the share of float sold short rose from 54% to 64% during the rally.
Pentwater agrees to pay Avis $650M in short-swing profits
Avis sued Pentwater Capital and affiliates on June 16, 2026 to recover short-swing profits under Section 16(b) of the Securities Exchange Act, and on June 19 agreed a settlement under which Pentwater will pay Avis $650 million in cash, subject to court approval in the Southern District of New York.
About 200 staff leave under voluntary termination program
In the first quarter of 2026 Avis Budget's Americas segment offered a limited-time voluntary termination program to certain field-operations and administrative employees in exchange for enhanced severance; about 200 employees had taken it and left by June 30, 2026, part of a global restructuring begun in 2024.
Spain fines Avis EUR 1M for fine-handling fee a court had voided
Spain's Ministry of Consumer Affairs fined Avis the maximum EUR 1 million for charging renters EUR 33.88 to EUR 45 as 'administrative management' of each traffic fine, a cost the law places on the vehicle owner. The ministry treated the case as aggravated because Avis kept the clause after a Vitoria-Gasteiz court declared it null in 2020; Avis can appeal in court.
Evidence (47 citations)
D1: User Value Erosion
D2: Business Customer Exploitation
D3: Shareholder Extraction
D4: Lock-in & Switching Costs
D5: Twiddling & Algorithmic Opacity
D6: Dark Patterns
D7: Advertising & Monetization Pressure
D8: Competitive Conduct
D9: Labor & Governance
D10: Regulatory & Legal Posture
Scoring Log (7 entries)
Checked 100 items (50 timeline, 39 evidence, 8 milestones, 3 alternatives) + prose. 40 verified, 49 corrected (13 date-only), 7 re-sourced, 4 removed. Invented: Cendant share plunge '$41 to $12' (SEC filings: $35.63 -> $19.06); '60-80% insurance profit margins' (only on carinsurent seller blog); '1 in 4 prepaid-fuel renters return with half a tank' (only on a rental blog). Also fixed Hertz-Dollar Thrifty remedy (Advantage + 29 locations, not 72), Travelers United fee figure (>10%, not 25%+), meme-stock figures, securities-suit filing date (Apr 2025), dates on many evidence items.
56->53. D3 6->5 (recalibration: no buybacks in 2025 or H1 2026 per 10-K/10-Qs; current layoffs come amid losses, not record profits/buybacks, so 4-5 band; the 2020-22 buyback extraction now scored in its own era at 7). D5 7->6 (correction: fact audit cut the '25%+' drip figure and Avis-specific AI/hourly pricing; remaining record = disclosed-before-payment drip, recovery-fee framing, e-Toll = medium-high band). D8 6->5 (recalibration: Avis's own conduct is multi-brand + 2013 Zipcar/Payless buys + ACRA membership; category pitfall on industry structure; fact audit removed ACRA-FTC-rule and share figures). Eras: all 5 re-dated to inflection events: Cendant Spinoff 2006-09-01->2006-09-05; Consolidation Wave 2013-01-01->2013-01-02 (Zipcar deal); 'Fee Escalation Era' 2018-01-01->2016-01-25 relabeled 'SRS Stake & Fee Creep' (SRS cooperation agreement, De Shon CEO, Payless cramming period); 'Pandemic Windfall' 2021-01-01->2020-03-23 relabeled 'Pandemic Shock & Windfall' (21,000 furloughs); current era 2026-02-14 (assessment date)->2025-02-11 relabeled 'Impairment & Hard Reset' ($2.3B impairment, CEO change). Since Sep 2025: securities suit dropped, Zipcar UK exit, Payless settlement approved, derivative suit dismissed, $518M EV write-down/$995M 2025 loss with buybacks paused, Zipcar HQ closure, Apr 2026 Pentwater short squeeze and $650M 16(b) settlement, ~200 voluntary exits, Spain EUR 1M fine (Aug 2026). Historical gap-fills: Valli admin-fee suit (2014), SRS cooperation agreement (2016), Ferraro interim CEO (2020), Italy AGCM fine (2024), Aug 2024 data breach. Not added (unreadable sources): Travelers United dismissal date, MSP contractor in-sourcing. Category OK.
Checked 24 removed/trimmed claims: 1 restored, 2 partly restored, 21 confirmed removed, 0 already present. Restored: FCRA settlement final approval (CourtListener docket, evidence added). Partly: Orlando 7-mile-radius 10% fee for fly-in renters (WaPo 2019-08-29; original said 10 miles); e-Toll 80%/65% reimbursement tiers (court-authorized Mendez notice, evidence dated to the settlement site's earliest archive capture 2022-09-29). Not settled within budget and left out: 'multiple states introduced P2P legislation' (only 2023 Duane Morris roundup and Turo's own blog found) and the FTC proposal covering airline tickets/cell phones (search summary only; Britannica unreadable). Confirmed removed with contrary or no support: $110M/$2.8B/second-largest, 60-80% margins, $102-to-$258 rates (J.D. Power/Kayak show $81-90), 218%/900% stock gain, telematics GPS/speed/tire data, 61 remote workers, millions of TikTok views, ACRA FTC lobbying, and others.
Triaged 2026-06-30 (Wave A); no rescore warranted (no material change / changes sub-threshold / flag refuted on verification).