Fri December 27, 2013
Cars Are Next Frontier For Sharing Services
Originally published on Fri December 27, 2013 9:57 am
Following the popularity of companies like Airbnb, which rent out a client's house or apartment to people visiting the area, more companies are trying the idea with cars. Companies like Uber help find someone to drive you around like a taxi. Another will let you rent out your car like a Zipcar while you're at work.
Now FlightCar is trying to make its mark with car-sharing for travelers. Instead of paying to park at the airport, you can bring your car to FlightCar and park for free, and the company will try to rent it out while you're away. That way you and the company can make money from the rental.
Constance Mussells of Rhode Island pulls into the FlightCar parking lot near Boston's Logan International Airport. She's heading to Florida for vacation and is dropping off her 2002 Mercedes station wagon.
"I'm going away for a couple of weeks. I went online and I found this, and I thought I'd give it a shot," she says.
FlightCar's co-founder, Kevin Petrovic, 19, of New Jersey, was admitted to Princeton but deferred enrollment to help launch the company. Pretty quickly, Petrovic and his business partner, who's also 19, managed to raise about $6 million from venture capitalists in Silicon Valley.
"There's really no fundraising climate quite like the San Francisco Bay Area," Petrovic says. "It's just unequaled anywhere in the world. So that's why we went there, and that's why we raised most of the money there too. Because that's where people really I would say are crazy enough to dump massive amounts of money into this kind of thing and hope it works."
So far, FlightCar is operating at three airports — Boston, San Francisco and Los Angeles. It has run into a legal skirmish in San Francisco. After you drop your car off at FlightCar, a black Town Car taxi takes you to the airport for free, and the airport in San Francisco wants FlightCar to pay for drop-off rights.
The company is fighting that because it says it needs to keep costs as low as possible. Unlike Airbnb, where you might spend more than $1,000 to rent a house or apartment, there's less money involved with renting a car.
"We're not making money, we're not profitable — we're working on it," Petrovic says. "To be profitable in the rental industry, it's difficult. A lot of things you can only accomplish at scale, but we are working toward all those things."
Petrovic says at the San Francisco location, they're doing 70 or 80 transactions a day. And over Thanksgiving, the company had 300 cars parked or rented there.
In Boston, Jen Chaplin is just getting off a flight and picking up a Toyota Corolla to rent. She went online and picked FlightCar because of the price. The cost to rent the Corolla is $200 for 10 days — that's $20 a day.
So, can FlightCar make money renting cars that inexpensively while paying car owners and dealing with other expenses — which, by the way, includes a car wash? It'll return your car vacuumed and scrubbed down.