Yahoo Finance Peer-to-Peer Car Sharing: Is it Worth Taking Part?
Now that I’ve promised never to be involved, peer-to-peer car sharing is taking off in Singapore. You people; just because I’ve had a few accidents doesn’t mean you shouldn’t rent to me, dammit. “There’s like, a department in the insurance company named after you“. Heh heh, yeah, my premiums now exceed my COE. But assuming you’re not like me, have a look at this new car sharing system:
Progress! Now everyone has an equal opportunity to have fits in traffic.
What is Peer-to-Peer Car Sharing?
I divide the country into two groups: People who own cars, and people who better have lots of patience.
The car owners are always complaining about costs. Their car loan is insane, they have to pay for petrol, Singapore’s parking fees deprive their children of an inheritance, etc.
The car-less people see that, and don’t want to deal with it. But at the same time, they aren’t overjoyed with our public transport. Not that you can blame them, since at present the MRT service would make a monk swear.
Peer to peer car sharing aims to connect the two: It allows car owners to rent their vehicles out, thus lowering their costs. And people without cars now have an alternative to actually buying one.
In exchange for pairing owners and renters, the car share company takes a cut of the rental transaction (around 15%).
Wait, You Can’t Just Let Anyone Drive Your Car!
He did NOT completely beat me in the driving test. I scored higher on basic theory.
Do you know what local car insurers are like?
If an unrecognized driver so much as breathes on the steering wheel, you might lose your no-claim discount. So obviously, car sharing needs a way to deal with that.
I e-mailed Jamie Wang, co-founder of car sharing site iCarsclub, about the problem. He replied that:
“With iCarsClub, we will issue the insurance coverage to our renter automatically when they start a journey. This will not affect your own car insurance in any way, since it’s under our company’s master plan.”
In other words, should the guy renting your car get into an accident, the policy in play is iCarsclub’s. You don’t need to make any claims.
But what about superficial damage Jamie? Like scratches or someone puking on the upholstery?
“The last renter will be liable for such damages. The owner can claim costs from us first, and we’ll recover our cost from the renters.”
With that out of the way, let’s look at plausible reasons to join the club:
Upsides of Car Sharing
If you hear sirens, I suggest you speed up. And remember, you never met me. Enjoy!
As we see it, the main advantages of car sharing are:
Car Owners can Monetize Their Vehicles
You Can Vary the Vehicle Required
Cheaper Than Car Rental Agencies
Petrol Discounts
Car Owners can Monetize Their Vehicles
Your car isn’t exactly a money machine, except for the guy who sold it to you. And if it’s parked most of the time, you’re better off using it for side-income.
I asked Jamie how much a car owner can potentially earn:
“Based on our market research, the average car owner can earn from $500 to $1000 per month,” but Jamie does add that it’s just a projection.
Car sharing is still new, so give I’d give it another year before we know the real numbers. Still, even if its just $500, that does beat negative $200 from leaving it in a parking lot.
You Can Vary the Vehicle Required
$5 an hour, and I’ll throw in a horse or a tetanus shot.
If you buy a car, you’re stuck with whatever decision you made.
Bought an economy model? Great for grocery runs, not so great for impressing a date. Bought a two-seater sports car? Better hope your third friend has a tight grip on that roof.
With car sharing, you can request the model you want. And while there’s no guarantee it’s available, you’ll at least have a chance.
Cheaper Than Car Rental Agencies
For reference, car rental services like Avis and Hertz charge around $120 to $150 a day. You’ll also pay a bunch of extras (e.g. extra $12 for GPS, extra $40 for another driver, and so forth).
With car sharing, prices are determined by renter – owner agreements. The club allows car owners to offer rates online, and negotiate further with interested renters.
“For renters, the rates on our platform are usually cheaper by 20%-30% of the market rate,” Jamie says, “because they are from free car resources.”
Again, the service is new, so we can’t verify this yet. But it does make sense, since car owners will try to undercut rental companies for business.
Follow us on Facebook, and we’ll update you as it develops.
Petrol Discounts
Yeah, I topped up for you. Windshield fluid is very important.
There’s a petrol discount for car owners. It’s called the iFuel program, and it gives you 20% off at Esso stations.
It’s free. Seriously, I quote from Jamie:
“All car owners can join us as a iFuelmember for free, to enjoy our privileges. They can upgrade to iCarOwner to share their cars with peers.“
Yep, it’s a petrol discount just for signing up. Whether or not you actually want to share your car. So if you have a vehicle, it might be worth registering for this freebie.
As for renters, fuel costs are deducted from an initial deposit, made when you rent the car. This will vary based on the total mileage (i.e. you pay for what you use).
The Downsides
The potential downsides are:
Getting to the Pick Up Point
Fussy Owners
Time Slots
Getting to the Pick Up Point
Did you have trouble getting to the car?
If you’re lucky, the previous driver will bring the car right to you. Otherwise you might need, uh, transport to get to your transport.
This gets problematic if you need the car at off-peak (read: godforsaken) hours. If you need to rent my car to get to Changi airport at 2 am, have fun walking to where it’s parked.
Fussy Owners
What if the car was scratched when you got it, and you didn’t notice? What if fussy owners moan about “a funny smell”, or insist old dents “only appeared” after you drove it?
This is a new thing in Singapore, and we don’t want to say some Singaporeans will be that way. But yes, some Singaporeans will be that way. We both know it.
We’ll just have to see the degree to which it happens.
Time Slots
You’ll probably have to book way in advance, for weekends or public holidays.
Remember that at the outset, the club won’t have a vehicle pool as large as Hertz or Avis. Nor will the pool rival cab companies in size. This means it may be hard to get cars on certain days, or at peak hours.
This problem may or may not go away, depending on the club’s ability to grow.
Image Credits:
epSos.de, qorize, mynameissharshar, ePi.Longo, comedy_nose, Trekking Rinjani
Would you take part in car sharing? Comment and let us know!
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