Volkswagen said it was considering a potential transaction, together with investors Attestor and Pon Holdings, although considerations were at a very early stage and no decisions had been taken.
Company sources told Reuters a year ago that VW wanted to buy back Europcar, which it sold to French financial investor Eurazeo in 2006 for 3.3 billion euros ($3.94 billion), including debt.
Europcar said on Wednesday it had rejected a takeover bid, without specifying the bidder, saying the 0.44 euro per share price offered was too low.
The car rental business has taken a heavy hit from the coronavirus pandemic given the collapse of the travel market.
Europcar's shares were up 5% on Thursday at 0.4550 euros.
Volkswagen said buying Europcar was one of several options it was considering to give the company access to a rental platform that would support its "long-term mobility vision" and strengthen its range of products and services.
Company sources have suggested that Volkswagen could use Europcar's network of rental stations to help it become a broader provider of different mobility options.
Bloomberg news agency had already reported that Europcar had rejected a $2.6 billion takeover bid from Volkswagen.
($1 = 0.8377 euros)
(Reporting by Jan Schwartz and Emma Thomasson; Editing by Caroline Copley and David Evans)