Lyft went public on Friday, March 29, 2019, with a value above $20 billion.

"With Lyft Rentals, we're giving riders the flexibility to rent a car for weekend getaways, business trips, or even to run errands," Lyft said in a blog post .

Lyft said on Thursday that it's introducing a car rental service, allowing customers to rent a vehicle without having to go to the counter. Hertz and Avis shares plunged on the news.

The service is initially available for select customers in the Bay Area and Los Angeles. Users tap the key icon on their app to start the process.

The rental option includes unlimited miles, and Lyft said it will handle refueling at market price.

"Our vehicles come equipped with Apple Carplay, Android Auto, and phone chargers," the post said. "Choose free add-ons like ski racks, car seats, and tire chains. And, we're adding hybrid vehicles to the mix soon."

Hertz dropped almost 6% to $15.26, and Avis fell 5% to $30.89.

Follow @CNBCtech on Twitter for the latest tech industry news.