If you’ve ever rolled up to a rental car lot and didn’t get the vehicle you thought you were going to get, you’re not alone. Turo, which claims the title as the world's largest peer-to-peer car sharing marketplace, says it has a better option to give customers exactly what they want.
As of June, the car-sharing company has upgraded its product in 70 ways, making it easier to find and rent a car. Turo says there is a $172B (yes, billion) market, and it’s keen to take bigger chunk of it. According to Forbes reporter Megan Poinski in March, Turo’s net revenues have grown nearly 88% between 2021 and 2023 to $879.6 million last year. The company has been profitable since 2021, and it has even filed to go public.
The Rise of Car Sharing
When the pandemic hit in 2020, rental car companies sold off a big chunk of vehicles to stay afloat. Then long-tail COVID effects, like chip shortages, made it difficult for them to restock.
Rental car giant Hertz says the average rental car cost per day has increased by nearly $35 per day since 2019. As such, consumers have been seeking alternative options. Turo CFO Chuck Fisher says all owners go through an onboarding process to help them list their vehicles successfully. The pricing system is left largely to individual owners, guided by market prices; some offer unlimited miles or accessories like roof racks for an additional fee.
“You have to be able to understand how a marketplace behaves, how trends develop over time,” Fisher emphasized in an interview for Forbes’ CFO Newsletter. “You become very comfortable with reading data, and extrapolating on trends, and understanding seasonality, and predicting the future based upon the behavior of your business as it develops over time.”
Turo is spending a fair amount of time and energy on the renter side, rolling out a passive income option for vehicle owners who want to earn money without dealing with the process. By partnering with hosts interested in managing a small fleet owners can still collect income, kind of like eBay sellers who hire higher-level sellers to represent them.
Cars Range From Ho-Hum To Holy Moley
Let’s be honest: renting a car can be a tedious experience. Not as bad as actually buying a car, thank heaven, but there’s still paperwork to file. Reserving a vehicle from Turo works similarly to online vacation rental home sites, which have exploded in popularity in the last several years. With more than 1,600 makes and models available, choice is key. That means renters can choose anything from a 2013 Hyundai Sonata to a $2,700-per-day Lamborghini Aventador.
“Turo is the new way of thinking about car travel,” says Turo CEO Andre Haddad. “It’s a way to drive your dream car, or test drive a car before you drop $50k on it, or find the perfect car that checks all the boxes for your family vacation.”
One of Turo’s new updates allows site users to browse vehicles regardless of location or date with a feature it’s calling “limitless search.” The company says it’s the first of its kind in its market segment. Another highlight is the organization of vehicles into collections with groups called Sensational Supercars, Electric Elite, Vintage Americana, Rugged 4X4s, and more.
Turo has a user feedback system like eBay’s, and top owners with high-quality, clean vehicles get a special designation. If you’re still trying to wrap your mind around renting someone’s personal car, know that RVSharehas been doing it effectively with recreational vehicles. Same goes for homes from AirBnb, VRBO, and others. Look for this company to continue its growth trajectory through 2024 and beyond.