Competition heats up in electronic tolling for rental cars

Competition is heating up in the provision of electronic tolling for rental car companies. American Traffic Solutions Inc (ATS) a leader in video tolling for rental cars under the brand PlatePass has bought the patent rights to the transponder mounting device EZ-Shield used by their chief rival, Highway Toll Administration LLC (HTA). HTA is the longest established and largest company providing transponders for rental cars. The EZ-Shield holder is used on some 30,000 rental cars in the northeast whose electronic tolling is managed by HTA.

James Tuton president of ATS announced recently his company had bought exclusive rights to the shielding holder device - US Patent # 6127938 - including intellectual property rights, designs, plans and manufacturing agreements.

ATS has renamed the EZ-Shield device: PlatePassTagShield.

It is a windshield-mounted holder and shield for a standard box transponder such as a E-ZPass, SunPass (FL) or FasTrak (CA) transponder. When the holder is closed metallic shielding prevents any radio signals moving between the transponder and toll reader antennas, effectively "switching off" the transponder. To activate the transponder the motorist exposes it by sliding the holder to an open position.

The shielding holder allows all the rental cars in a fleet to be fitted with the transponder while giving renters the option to switch off the transponder if they prefer to pay cash. Without the device rental car companies have to ask each customer whether they want the transponder and install it, or if they are installed in all cars the customer has no choice about using it.

American Traffic Solutions (ATS) of Scottsdale AZ are specialists in use of cameras for tolling, first for handling violations and now for collecting tolls. They pioneered video tolling for rental cars in Texas and say they are set up with systems for handling car rental fleets across north America for transponderless electronic tolling. Harris County Toll Road Authority in Houston have been doing video tolls via Platepass with Budget, Avis and Hertz rental cars for about a year. HCTRA have enrolled commercial fleets in their video toll program also.

But E-ZPass and other toll agencies have been reluctant to do video tolling.

So ATS is following HTA with transponders in the northeast under a contract with Hertz. So far they only have about 3,000 transponders in Hertz cars between northern Virginia and Boston, but the shield-holder should help them deepen their penetration of the E-ZPass market. 

ATS president Tuton says the purchase of rights to the shield holder is "a major milestone."

"This way we can use a transponder the same way we offer (video) PlatePass, where the renter can make the buy decision at the toll plaza, and not at the airport rental car counter. If they want to avoid a cash lane line, or want to start a toll account for which they will receive a tabulated receipt on www.PlatePass.com, they can use the PlatePass service.

"In the plate-based model, they simply drive through any transponder-only lane, and the license plate will been seen and start the process.In the transponder model, the TagShield enables the customer to open the drawer to expose the working tag. The first tag read/toll transaction starts the same process, and the account will be started for the renter until the rental vehicle is returned and the agreement is closed."

Tuton hopes to rapidly expand his business with toll authorities which aren't prepared to do video-tolling.

He says before they bought patent righs to the shield holder device they invested "significant resources" with engineering and patent lawyers, adding: "The patent is extremely well crafted and essentially prevents any others making/selling a device for the same use."

Highway Toll Administration LLC
Highway Toll Administration LLC of Long Island NY (HTA) are the dominant suppliers of transponders to rental car customers. In business for five years they shunned publicity until recently preferring to work silently through rental car companies until recently. They provide transponders to Budget and Avis cars in the E-ZPass area and now have over 30,000 in use.

David Centner, the president of HTA told us that ATS purchase of the EZ-Shield patent is "much ado about nothing."

He says that ATS is acknowledging that HTA's business model is the right one: "We are flattered."

Centner says HTA was offered the right to the TagShield patent but declined to buy. He doesn't think the patent is strong in law. In any case, he says, HTA wants to go in future with "open solutions" that don't depend on patents.

He doesn't say what HTA's plans are now they can't buy the shield holders except from their competitor. But he says HTA has plenty in inventory for the immediate future and they expect to move on with new solutions.

HTA is doing twenty times the transactions of their nearest competitor (ATS), says Centner, and he is buoyed up by the "superhappy customers we have." (See below)

The group has just joined IBTTA - James Tuton of ATS has been a prominent figure in IBTTA forums for a decade - and Centner has just returned from his first IBTTA forum in Austin TX, and speaks about it with enthusiasm. He says he met a bunch of "very nice and smart people" and enjoyed himself "immensely."

HTA has "tried many different business models" he says.

They started trying to "make a business out of the spread," the discount for transponders by charging the cash toll to rental car people. Then they moved to different daily rates - 99c for a while, then $1.25, now $1.50.

The average rental with their transponder, Centner, says is 2.9 days and on average sees $8 to $9 in toll bills.

On video tolling, Centner says "we'd like it very much, too, if we were allowed."

"Obviously we'd love to avoid having to manage a bunch of transponders, but E-ZPass doesn't allow it (video tolling)."

Major obstacle is MTA Bridges & Tunnels which still has gates on its transponder lanes and no cameras - TOLLROADSnews comment.

Rent A Toll
Another company doing video tolling is Rent A Toll Ltd of Plano TX which processes tolls for customers of Dollar and Thrifty rental cars on NTTA (Dallas) and HCTRA (Houston) tollroads. Using the brand Pass24 they charge $8.95/day with a prepaid unlimited use service covering all the tolls you can run up. They started operations in Dallas in September and in Houston earlier this year at $10/day, later reducing their charge the $1.05.

Rent a Toll say the advantage of their approach is that the customer gets tolls covered as part of the car rental agreement and there is no separate charge for the tolls - a convenience for people charging business expenses.

Jim Glasheen of Rent A Toll says the Pass24 prepaid, unlimited-use model is on track and doing well with Dollar and Thrifty but they have other business models in development as options including what he calls a transaction based offering - similar to HTA and ATS.

They see a market among second tier companies, and fleets.

Rent A Toll don't rule out getting into transponders either though Glasheen says there are obvious advantages in video tolling - not having to manage the inventory of transponders.

They've got 14 patents in the works, they say, but decline to provide details.

HTA's fanmail:

David Centner keeps fanmail in an Excel spreadsheet he sent us. We've left out names and other details and just pasted in the comments below.

It was such a pleasure to be able to use E-ZPass while traveling in the NJ and PA area in my rental car. I am spoiled with Fast Lane at home in Massachusetts in my personal car it was always such a bummer to have to stop and pay tolls while traveling in a rental car every week. I cover the whole northeast and look forward to using Fast Lane from know on.
Great service!
I love the service! Thanks!
Great system!
Very convenient.
The EZ Pass made our travels easy and hassel free. Thanks for the convenience!
Having the easy pass was an excellent perk with this Budget rental car and saved us time every day as we travelled throughout the east coast. It is an exceptionally valuable service. We will use a rental company that provides this service next time we travel in that area of the country.
Thank you so much for offering this service
I enjoyed using the toll device on the rental car. It felt good to drive right through the toll booths rather than stopping everytime to pay the toll.
This was a great add on service.
This service is great!
Fantastic service. Have been looking for this service for years. Make sure that it is available in ALL rental cars
Excellent Ideas ! Made driving so much easier!
I appreciate the service
The E-ZPass was great, saved lost of time!!
Loved the service just need a reciept for expense report
For someone like me who travels every week and usually rents a car, anything that makes my life easier is a blessing. This was a very pleasant and nice surprise. Keep up the good work!
Great Service
A fantastic service!!
Love the fact that this is now available in cars that I rent!!!
This is easy. I'm going to do this next time!
This worked very well with the rental and saved me a lot of time.
The EZ pass rental made commuting much easier for me. Thank you.
Very Helpful- thank you!
EZ Pass made the trip much easier.
Great Idea!!!
E-Z Pass and receipt log are very good - keep up the good work.
Yes, the EZ pass workedout great so far for me and has made my commute a lot faster, it would be more helpful however to recieve itemized reciepts of my toll activity at the end of the week so that I may recieve faster reimbursement from my employer.
This is the best service that any rental agency can offer. The time savings and convenience is invaluable. Thank you!
This was a terrific idea. It worked perfectly and saved a lot of time and aggravation.
Awesome program! Please keep it up. Great for quick business travel!
It was an extreme pleasure to have.
Great service thanks,need receipt asap
I love this new service -- IF I really get the receipt promptly in order to submit it with my travel expense report!
I love this service! It definitely affects my choice in deciding which Rental Car agency to use. Thank you for taking away one more hassle for the business traveler....much appreciated!
Very pleased that E-ZPass is available for rental cars...makes life on the toll roads much better! Hope obtaining the itemized receipt is quick and accurate.
This is an excellent service. Thanks.
The transponder (EZ-PASS) made driving on the toll roads in the New Jersey area much quicker, for the added convenience it is quite cost effective. Great concept.
It was my first rental using the EZPass. It was great and I intend to use it each time I visit the area
Offering this service through car rental companies is much appreciated. I travel to new Jersey frequently on business and this has saved me time and bother. Thank you very much.
Excellent service- having gotten used to Sun Pass on our own cars we REALLY appreciated the EZ Pass rental service!!
Great service!
This was the 1st time I'd used the EZ-Pass option while renting, and I found myself very thankful for the option. It sure made my business trip a LOT less hassle!
It's a great service you provide. The convenience of the speed pass was wonderful. Thank you
E-ZPass was a very useful service and I found it convenient to use. Thank you.
Very nice having this in the car; a big time and hassle saver.
I really appreciated the convenince of having an EZPass in my rental car. I wish I could have this for whatever state I was visiting like Illinois and that I could rent it for when travelling in my own vehicle. I takes a lot of frustration out of the trip. Thank you!
This service was extremely convenient...
Using the ez pass was great - good idea to put into rental vehicles
Great service - hopefully I will receive my receipt in a timely fashion. Thanks.
It was great that your city offers this service and I will continue to use it as my travels to your area increase. In addition, NY is a wonderful city. Thanks,
Great system-enjoyed using it.
Great idea, saves time and worry
Wonderful service and a reasonable price. Hope you get with ALL the rental companies!!
This is a great service- I drove from EWR to Westchester PA to Avenel and spent three days working in NJ,NY and CT-- and never had to sit in line once to pay for any tolls. This service needs to be avaiable in Orlando and PHL
Great service. Need Itemized recpt detail for expensing. Thank you and best regards.

ends HTA fanmail

TOLLROADSnews 2007-04-30