Shares of Avis Budget Group (CAR) rose more than 10% on heavy trading volume on Monday after the vehicle rental service company and Alphabet's (GOOGL) self-driving car unit Waymo reached a deal that would allow Avis to manage the latter's autonomous vehicle fleet.
Avis will service and store Waymo's Chrysler Pacifica minivans in Phoenix, where Alphabet is testing a ride-sharing service. Waymo will own the vehicles and pay Avis for its service, but financial terms were not disclosed.
The agreement is a multiyear, although non-exclusive, deal.
"The collaboration is designed to support Waymo's growing autonomous vehicle (AV) fleet and Waymo's early rider program, a public trial of its self-driving cars in Phoenix, Arizona. Waymo recently announced that it is adding hundreds of Chrysler Pacifica minivans to build a 600-vehicle fleet. This partnership will allow Avis Budget Group to service Waymo's growing number of cars on the road, ensuring Waymo's self-driving vehicles are ready for riders around the clock, Avis said.
Under the multi-year agreement, Avis Budget Group will enhance selected rental facilities to offer automotive services and secure parking for Waymo's fleet. The services offered by Avis Budget Group include interior and exterior cleaning, oil changes, tire rotations, and the checking, ordering, and installation of automotive parts, as well as other necessary fleet support and maintenance.
"With members of the public using our growing fleet of self-driving cars, our vehicles need standard maintenance and cleaning, so they're ready for our riders at any time of the day or night," said John Krafcik, chief executive officer, Waymo. "Avis Budget Group is an ideal partner to provide fleet support and maintenance. With thousands of locations around the world, Avis Budget Group can help us bring our technology to more people, in more places."
-Greg Morcroft contributed to this story.
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