23 Nov 2022 | 5 min read
“Most privately owned vehicles sit idle more than 90% of the time” – P2P Carsharing Market Analysis by Robert C. Hampshire and Craig Gaites
The solution to monetise all this time? Peer 2 Peer.
In one year, a private car sits idle 328.5 days. Yes, we know, this made you blink.
Let’s take a step back and explain what Peer to Peer Car Sharing (P2P) is.
Known as the ‘AirBnB of cars’, P2P Car Sharing sees private individuals (in jargon known as “Hosts”) as car providers, their owned cars being shared for users on P2P platforms. So, when a user signs up to the platform, he/she searches for an available car at a convenient place and date, and books it from a private party in exchange for money, which is controlled and tracked through the P2P platform.
For the guest, co-protagonist of this market, Peer 2 Peer is an alternative to the more traditional car rental, which implies considerable cost savings. As reported in the previous article on Car Rentals and the episode on the microchip crisis, the rental market is experiencing a drastic downturn in the availability of cars. This is causing rental prices to rise exponentially, while P2P is gaining ground.
Just as some rentals do, P2P also allows the guest to choose the car model. While only some rentals do it for a higher rate (conventionally they guarantee the category/segment and not the specific model), for P2P it is a granted option.
Each car shared removes between 4.6 and 20 private cars on the road. In addition to the removal of unused private cars, P2P wants to provide a scalable carsharing solution that addresses both the high costs of private vehicle ownership and the reduction of greenhouse gas emissions.
👉🏾 Turo (US, Canada, and UK) – The world largest P2P car sharing marketplace widely spread around US and Canada (500k cars approx.) and a good presence also in the UK, mostly around London (7k cars listed). In the EU scenario, they also recently acquired the French P2P platform Ouicar which counts approximately 30.000 vehicles listed on the platform.
👉🏾 Getaround (US, EU, and UK) – European P2P platform counting around 20k vehicles listed in the platform and more than 5M users.
👉🏾 GoMore (Denmark) – The Danish P2P is currently present in 6 markets around Europe: Denmark, Sweden, Finalndia, Spain (Amovens), Austria, and Switzerland.
👉🏾 Snappcar (NL) – Dutch P2P with currently 12k cars on the platform.
👉🏾 Hiyacar (UK) – A 100k members P2P car sharing platform operating throughout UK.
👉🏾Auting (IT) – The P2P player in the Italian market.
Before the pandemic hit, car sharing mainly covered journeys in the evening and on the weekend for leisure, daily short trips mainly.
After the pandemic, nearly 60% of people started to avoid non mandatory travel and stayed home. People who don’t have a private vehicle, usually opt for alternative mobility means to avoid mass public transportation, and here is where the use and potential of vehicle sharing is exploited to the fullest.
One of PWC recent surveys on 1000 consumers recorded that, in 2019, 72% of people indicated a radical shift towards sharing mobility. With the advent of the global pandemic, the economy suffered a drastic drop, and digital channels kept being more important every day to overcome this descent.
“Consumers in shared mobility are prioritizing health and preventive measures rather than monetary offers”.
Vinod & Sharma stated in a survey on Covid-19 impact on the sharing economy pre and post pandemic that, before the pandemic, the major demand in mobility services was revolving around discounts offerings and cheaper rates.
While after the pandemic, has been noted a radical rise in other parameters such as cleanliness, safety, and propensity for more immediate processes to avoid contacts.
In the survey of 115 people, 88 of them (more than 75%), were more likely to use sharing mobility if their needs are taken care of in the right way. This is the need in which digital innovations must take root to bring about the change that everyone needs. The modern user wants convenience and security rather than the cheapest price for a more uncomfortable condition.
Statista depicts a projection graph on the increase of vehicles in the P2P car sharing platforms from 2015 to 2025. Period encompassing the pre and post-pandemic, noting how, over the next 3 years, forecasts predict about 1M vehicles listed on the various platforms.
“Turo’s main selling point is convenience.”
The sheer convenience and immediacy of P2P has grown tremendously during the pandemic. In fact, sales skyrocketed, tripling in the first nine months of 2021 to almost $350M.
Starting from one of the most appealing aspects of P2P, hence convenience, we can identify some aspects that make the P2P market so innovative and enticing for the modern user.
1) Switch of experience 🆕🚙
The lack of vehicles available on the market from large rental companies has caused users to veer towards alternative solutions. The component crisis, which is severely hampering the availability of cars, is one of the factors why users have started to explore alternative options to classic car rental.
Hence, the desire to navigate a completely new, innovative rental experience, sparking curiosity in the user’s mind.
2) Good value for money 💰
Both owning and renting a car has become way more costly due to the hard meagre availability of vehicles, soaring prices of fuel, parking, and insurance expenses… (and many more, unfortunately!)
This is where P2P pops up.
Users can have a car at disposal, quickly, and hassle-free. Renting is the only price they have to take care of when it comes to renting a car on P2P platforms.
According to Turo, Peer to Peer clients can save about 30% compared to a traditional car rental.
The Ascent carried out a comparative analysis on car rental prices in LA from 10 to 18 July 2021.
The cheapest option from Enterprise Rent a Car was $785.01 for an average size vehicle, unlimited mileage, and pick up and drop off at LAX airport.
While on the Turo platform, same dates and unlimited mileage, a 2019 Toyota Corolla cost $320, with pick up and drop off in a nearby area of downtown LA.
The saving was indisputable: $450. Not bad, right?
The current challenges in the car market and the crisis that is affecting car rentals are crucial aspects when choosing a rental experience. P2P sees an opportunity to leverage cheaper prices and the ease of a time-saving and worry-free experience. (This connects us to the third benefit of P2P that we will discuss: the contactless experience).
3) The contactless experience 🔓
The effects that covid left in society do not only concern economic woes, but also social ones.
We live in a time when people try hard to avoid overcrowded places, means of transport where everyone is crammed in like sardines, or long waiting queues to rent a car.
While car rentals still struggle to adopt it and understand its incredible potential and benefit, Peer to Peer immediately provided the opportunity for a contactless rental experience.
Just think about Turo, they offer the possibility of keyless and contactless solutions in one host’s fleet of vehicles, at its discretion. Thus, the idea of being able to rent and monetize one’s idle cars 24/7 is no longer a pipe dream, but a possible reality.
The benefit would come from both sides:
For hosts, in managing rentals anywhere, regardless of whether it is relaxing at home in Isle of Dogs or in Paris sipping a coffee looking at the Seine.
For guests, in the speed and peacefulness of the rental. Without worries about long waiting times and overcrowded front desks to collect the car keys, these will be inside the glove box of the vehicle, which will be easily accessed via smartphone.
Let’s focus on the Host side for a sec.
Just as the guest seeks the smoothest experience, so the host equally wants to optimize its time in the best possible way. Private cars sit idle for 328.5 days out of 365, hosts’ ultimate goal is to not miss the opportunity to make those stagnant days pay off.
Very often the platform-listed vehicles are a side business for the hosts, who have another regular job in their daily lives, to which they add P2P.
This is just one of the ideal use cases for the adoption of a keyless solution.
The circular approach swirling around P2P is disrupting the industry in a way that benefits renters and vehicle owners at the same time.
Peer to peer car sharing is also a way of contributing towards sustainable travel networks, making better use of existing cars, which on average sit idle 96% of the time.
The current benefits and future developments around the Peer to Peer car sharing market are plentiful and proves that it is not a pass-by trend but a market that is here to stay.
Sales and Marketing Associate at 2hire
I love running and daydreaming losing count of the distance I’m covering, cooking (and especially eating) and Drake is my spirit guide.