In the short run, you're probably right- I imagine the profit margins for fuel charges, like optional insurance, are much higher than those of the renter's actual rental and this gimmick is a decent fiscal shot in the arm.

Maybe the wizards at Hertz have it all figured out , but I was taught that in the long run customer retention is much cheaper than customer acquisition and is key to any sustainable business model. Putting loyal, high-revenue non-corporate loyal customers on the DNR list strikes me as remarkably stupid, no matter how you slice it or dice it.