7 ms·

There is a clear value add for people coming into a city who don't want to rent a normal rental car. But I'm not sure the same value add is there for people re

by physcab 13y ago

There is a clear value add for people coming into a city who don't want to rent a normal rental car. But I'm not sure the same value add is there for people renting out their car, unlike Airbnb. If the maximum you can obtain for renting out your car is < $100, is that really what your emotional peace of mind (your car being ticketed, trashed, and scratched, loss in blue book value) is worth?

nostromo 13y ago
Don't forget the cost of parking at the airport. If you're gone for 10 days, that's almost $200.
- pg 13y ago
  Yes, the free parking is the big appeal for users, not the money they could make if their car is rented out.
  - mazumdar 13y ago
    While free parking is appealing for many users, it’s definitely not for many others because unlike Airbnb, the value of their possession (in this case, their car) is variable while the compensation (free parking and $10/day rented out) is fixed in the sense that it is pre-determined. With Airbnb, the compensation is variable and is set based on the owner's perceived value (which factors in the 'emotional piece of mind’ too among other things). It’s essentially a market based approach, and to get a wider acceptance from the supply-side, that’s what FlightCar needs to incorporate while preserving simplicity. As an optimist, I believe the creases will get ironed out eventually. It’s not going to be easy (never is) and it might take some time, but it will happen. Here’s a structure that comes to my mind: Tier 1 – Free parking and $10 for every day the car is rented out (like they have now) Tier 2 – Pay $X per day to park and Receive $Y for every day the car is rented out, where X is the market rate which in SFO’s case is $18 and Y is the daily rental-price you name.
    - LucasCollecchia 13y ago
      While I think this is a good approach, since the service's main drawbacks involve cosmetic damage, it makes sense to launch using a payment model which favors lower-end cars. Once the damage issues are adequately addressed in practice Tier 2, or an equivalent, might become more attractive.
- angryasian 13y ago
  why wouldn't you just take a cab vs paying that much for parking
  - YuriNiyazov 13y ago
    Because if you park on the street outside of the apartment where you live (which is many people, btw - very few people have a dedicated parking spot), then chances are you will get ticketed if you are gone while there's street cleaning happening. To prevent that from happening, you would have to arrange with your friends to move it while you are gone, or you would have to pay someone to do it. In the first case this is an inconvenience, in the second case it's an expense, and the downsides of letting someone else behind the wheel of your car are the same as renting it out.
    - angryasian 13y ago
      while a valid use case, I wonder if its the norm and how big this market is.
      - YuriNiyazov 13y ago
        I wonder how familiar you are with urban living in the United States. At least within my circle of family and friends, this is very common.
        angryasian 13y ago
        I've lived in the two largest cities in the US. I'm very familiar with urban living. In NYC everyone takes cabs and don't own cars. In LA everyone drives and can hire very cheap cars to lax or shared shuttles. Its hardly a problem in either of the biggest urban centers in the US.
        YuriNiyazov 13y ago
        "In NYC everyone takes cabs and don't own cars." - Jesus man, have you ever been outside of Manhattan? If everyone in NYC doesn't own a car, why are there so many fucking cars there all the time? I grew up in Queens, in huge apartment buildings. Everyone there has cars with street parking that they have to move every time street sweeping comes around.
aashaykumar92 13y ago
The emotional peace of mind is the exact thing that FlightCar and Airbnb are creating by encouraging this aspect of sharing. Yeah shit can go wrong with your car--that's with anything sharing-based though. As the saying goes, "Shit happens". But at the end of the day, sharing is a good thing and people are opening up to the aspect of it more and more. Essentially, the idea that you are sharing with others is the peace of mind. Hasn't warmed up with everyone, but it has with some and will continue. As someone else pointed out, I'm sure FlightCar will change their pricing as it gains more traction. For now, the pricing is just a reasonable and simple model. If there's one thing I disagree with from PG's comment, it's his prediction that this could be the economic story of the decade...no, it has the potential to be the economic story of the century. Not FlightCar by itself, but all these companies disrupting different industries through the simple idea of sharing--it's revolutionary and still young.
- pg 13y ago
  You're right, but I always try to underestimate things. It would be pretty big if ownership turned out to be largely a hack people resorted to before they had the infrastructure to manage sharing properly.
  - andrewljohnson 13y ago
    Nailed it... "ownership turned out to be largely a hack people resorted to before they had the infrastructure to manage sharing properly" Ownership is just an idea to align consumption with stewardship. The idea that owning stuff is "right" or "good" is just a cultural phenomenon, and not one shared by all cultures (e.g. Native Americans). I think you could do a lot worse in trying to find a start-up idea than to ask yourself "where is there excess capacity that can be shared." Parking, housing, office space, cooking, people-to-do-tasks, storage space, server space - this is the sharing era.
  - rayiner 13y ago
    It's not so much that ownership is a hack, or that sharing will replace ownership, but that as technology improves the transaction costs for trading property rights decreases, allowing "ownership" to be treated in a more fine-grained way than previously possible. You can see a fairly pure instance of this situation in spectrum management (which is a common area used to study property rights because it's easy to deal with theoretically). In 1960, Ronald Coase said we should break off big chunks of spectrum and sell it off for exclusive use, just like we do with land. Transactions in those rights will help achieve efficient allocations of resources, but there is a limit at which transaction costs dominate and optimal allocations aren't reached. If you think of something very coarse-grained like frequencies for broadcast radio, you're likely to get efficient allocations via trading of property rights. If you think of something very fine-grained like allocation of frequencies to a cell phone as it travels through a busy intersection, the idea of doing micro-transactions to yield an optimal allocation becomes intractable in the face of transaction costs. But as you make the transactions cheaper, through technology, it becomes more practical to do micro-transactions. This basic phenomenon is generalizable to pretty much any situation where you have property rights that are coarse-grained out of accounting convenience. If you can make it cheap and easy to break off little chunks of the property right and trade in them, you'll achieve a more optimal allocation of rights. That's pretty much exactly what AirBnB and FlightCar are: not sharing, but ways of breaking off a piece of a coarse property right and trading in those little pieces in a fine-grained way.
QuotedForTruth 13y ago
A search on flightcar shows results allowing 90 miles/day. At $28/day ($10+$18 in parking savings), thats $.31/mile. At $18/day ($10+$8 parking) thats $.20/mile. This is probably the worst case. Most people wont drive 90 miles everyday. The federal reimbursment rate is $.55/mile. You have to pull gas reimbursment out of that because like normal rental cars (I assume) flightcar renters pay for their own gas. A conservative estimate based on 20 miles/gallon and $4/gallon is $.20/mile in gas cost. Each mile the renter drives using your vehicle thus costs you $.35 in wear and tear and depreciation. An alternative data point would be car lease mileage overage fees. They are commonly $.15-$.25/mile and are supposed to represent the extra depreciation of the vehicle. So its in the right neighborhood of value to the car owner but probably doesnt represent much profit and may not be worth the hassle.
- shrig94 13y ago
  For brand new cars, FlightCar honestly comes out to about even as you mentioned. Though, our ordinary car is an '08 Prius, which has depreciated enough in value (as cars depreciate quickly!) to make our service a definite positive. Also, our utility will probably never really be 100% (Hertz for example is doing a lot to increase their's and is at 65% or so I believe). So your car most likely won't be rented for everyday you're gone. We do try and make the experience way better than traditional airport parking. We drop you off and pick you up in a town car and we give you free Starbuck's coffee before you fly and after you land! You also don't come home to an outrageous bill!
  - QuotedForTruth 13y ago
    Thanks for the reply. As you mention, a day or two without being rented would definitely swing it more in the car owners favor. Perhaps the best idea is just to bring a car so ugly no one would rent it!
    - cjreyes 13y ago
      I tried to bring my 95' Camry with broken door handles, windows that don't go down, oil leak, and no paint on the hood to rent with FlightCar ... but it didn't qualify. Not surprisingly, they have quality standards :-p

by physcab 13y ago

nostromo 13y ago

Don't forget the cost of parking at the airport. If you're gone for 10 days, that's almost $200.

pg 13y ago
Yes, the free parking is the big appeal for users, not the money they could make if their car is rented out.
- mazumdar 13y ago
  While free parking is appealing for many users, it’s definitely not for many others because unlike Airbnb, the value of their possession (in this case, their car) is variable while the compensation (free parking and $10/day rented out) is fixed in the sense that it is pre-determined. With Airbnb, the compensation is variable and is set based on the owner's perceived value (which factors in the 'emotional piece of mind’ too among other things). It’s essentially a market based approach, and to get a wider acceptance from the supply-side, that’s what FlightCar needs to incorporate while preserving simplicity. As an optimist, I believe the creases will get ironed out eventually. It’s not going to be easy (never is) and it might take some time, but it will happen. Here’s a structure that comes to my mind: Tier 1 – Free parking and $10 for every day the car is rented out (like they have now) Tier 2 – Pay $X per day to park and Receive $Y for every day the car is rented out, where X is the market rate which in SFO’s case is $18 and Y is the daily rental-price you name.
  - LucasCollecchia 13y ago
    While I think this is a good approach, since the service's main drawbacks involve cosmetic damage, it makes sense to launch using a payment model which favors lower-end cars. Once the damage issues are adequately addressed in practice Tier 2, or an equivalent, might become more attractive.
angryasian 13y ago
why wouldn't you just take a cab vs paying that much for parking
- YuriNiyazov 13y ago
  Because if you park on the street outside of the apartment where you live (which is many people, btw - very few people have a dedicated parking spot), then chances are you will get ticketed if you are gone while there's street cleaning happening. To prevent that from happening, you would have to arrange with your friends to move it while you are gone, or you would have to pay someone to do it. In the first case this is an inconvenience, in the second case it's an expense, and the downsides of letting someone else behind the wheel of your car are the same as renting it out.
  - angryasian 13y ago
    while a valid use case, I wonder if its the norm and how big this market is.
    - YuriNiyazov 13y ago
      I wonder how familiar you are with urban living in the United States. At least within my circle of family and friends, this is very common.
      - angryasian 13y ago
        I've lived in the two largest cities in the US. I'm very familiar with urban living. In NYC everyone takes cabs and don't own cars. In LA everyone drives and can hire very cheap cars to lax or shared shuttles. Its hardly a problem in either of the biggest urban centers in the US.
        YuriNiyazov 13y ago
        "In NYC everyone takes cabs and don't own cars." - Jesus man, have you ever been outside of Manhattan? If everyone in NYC doesn't own a car, why are there so many fucking cars there all the time? I grew up in Queens, in huge apartment buildings. Everyone there has cars with street parking that they have to move every time street sweeping comes around.

aashaykumar92 13y ago

The emotional peace of mind is the exact thing that FlightCar and Airbnb are creating by encouraging this aspect of sharing. Yeah shit can go wrong with your car--that's with anything sharing-based though. As the saying goes, "Shit happens". But at the end of the day, sharing is a good thing and people are opening up to the aspect of it more and more. Essentially, the idea that you are sharing with others is the peace of mind. Hasn't warmed up with everyone, but it has with some and will continue. As someone else pointed out, I'm sure FlightCar will change their pricing as it gains more traction. For now, the pricing is just a reasonable and simple model. If there's one thing I disagree with from PG's comment, it's his prediction that this could be the economic story of the decade...no, it has the potential to be the economic story of the century. Not FlightCar by itself, but all these companies disrupting different industries through the simple idea of sharing--it's revolutionary and still young.

pg 13y ago
You're right, but I always try to underestimate things. It would be pretty big if ownership turned out to be largely a hack people resorted to before they had the infrastructure to manage sharing properly.
- andrewljohnson 13y ago
  Nailed it... "ownership turned out to be largely a hack people resorted to before they had the infrastructure to manage sharing properly" Ownership is just an idea to align consumption with stewardship. The idea that owning stuff is "right" or "good" is just a cultural phenomenon, and not one shared by all cultures (e.g. Native Americans). I think you could do a lot worse in trying to find a start-up idea than to ask yourself "where is there excess capacity that can be shared." Parking, housing, office space, cooking, people-to-do-tasks, storage space, server space - this is the sharing era.
- rayiner 13y ago
  It's not so much that ownership is a hack, or that sharing will replace ownership, but that as technology improves the transaction costs for trading property rights decreases, allowing "ownership" to be treated in a more fine-grained way than previously possible. You can see a fairly pure instance of this situation in spectrum management (which is a common area used to study property rights because it's easy to deal with theoretically). In 1960, Ronald Coase said we should break off big chunks of spectrum and sell it off for exclusive use, just like we do with land. Transactions in those rights will help achieve efficient allocations of resources, but there is a limit at which transaction costs dominate and optimal allocations aren't reached. If you think of something very coarse-grained like frequencies for broadcast radio, you're likely to get efficient allocations via trading of property rights. If you think of something very fine-grained like allocation of frequencies to a cell phone as it travels through a busy intersection, the idea of doing micro-transactions to yield an optimal allocation becomes intractable in the face of transaction costs. But as you make the transactions cheaper, through technology, it becomes more practical to do micro-transactions. This basic phenomenon is generalizable to pretty much any situation where you have property rights that are coarse-grained out of accounting convenience. If you can make it cheap and easy to break off little chunks of the property right and trade in them, you'll achieve a more optimal allocation of rights. That's pretty much exactly what AirBnB and FlightCar are: not sharing, but ways of breaking off a piece of a coarse property right and trading in those little pieces in a fine-grained way.

QuotedForTruth 13y ago

A search on flightcar shows results allowing 90 miles/day. At $28/day ($10+$18 in parking savings), thats $.31/mile. At $18/day ($10+$8 parking) thats $.20/mile. This is probably the worst case. Most people wont drive 90 miles everyday. The federal reimbursment rate is $.55/mile. You have to pull gas reimbursment out of that because like normal rental cars (I assume) flightcar renters pay for their own gas. A conservative estimate based on 20 miles/gallon and $4/gallon is $.20/mile in gas cost. Each mile the renter drives using your vehicle thus costs you $.35 in wear and tear and depreciation. An alternative data point would be car lease mileage overage fees. They are commonly $.15-$.25/mile and are supposed to represent the extra depreciation of the vehicle. So its in the right neighborhood of value to the car owner but probably doesnt represent much profit and may not be worth the hassle.

shrig94 13y ago
For brand new cars, FlightCar honestly comes out to about even as you mentioned. Though, our ordinary car is an '08 Prius, which has depreciated enough in value (as cars depreciate quickly!) to make our service a definite positive. Also, our utility will probably never really be 100% (Hertz for example is doing a lot to increase their's and is at 65% or so I believe). So your car most likely won't be rented for everyday you're gone. We do try and make the experience way better than traditional airport parking. We drop you off and pick you up in a town car and we give you free Starbuck's coffee before you fly and after you land! You also don't come home to an outrageous bill!
- QuotedForTruth 13y ago
  Thanks for the reply. As you mention, a day or two without being rented would definitely swing it more in the car owners favor. Perhaps the best idea is just to bring a car so ugly no one would rent it!
  - cjreyes 13y ago
    I tried to bring my 95' Camry with broken door handles, windows that don't go down, oil leak, and no paint on the hood to rent with FlightCar ... but it didn't qualify. Not surprisingly, they have quality standards :-p