The real genius of this (apart from stealing customers back from National) is in the "Upgrade" option. When I travel for leisure I'm usually theoretically willing to pay a bit extra to get something a bit cooler, but I rarely do.
I won't book a "Cool Car" because they charge crazy-high amounts for them -- they have to because they're giving up a bunch of flexibility in their inventory by guaranteeing me a particular model. On the other hand I rarely book something as nebulous as "premium" or "luxury" because knowing my luck I'll inevitably just wind up with a Town Car instead of a BMW.
But if they start really pushing the idea of painless on-the-spot paid upgrades to defined cars I think they can sell a bunch of 'em while still maintaining flexibility in their fleet. Got some spare Infinitis? Great, stick 'em on the upgrade lot with "$20 a day extra" in the windscreen. They'll be raking in the extra bucks in no time.