By on June 8, 2011

With car sharing on the rise, my home state of Oregon is moving towards changing insurance rules to allow private “peer to peer” rentals by auto owners. The Oregonian reports that HB 3149 is headed for the Governor’s desk, having been approved by the state House and Senate. Sponsor Rep Ben Cannon explains

Most insurance policies prohibit people from using their cars for commercial purposes. This bill says someone can participate in car sharing without having to worry that their insurance will be canceled.

California is the only other state to have passed such legislation, and already Facebook-based peer-to-peer car rental firms like Getaround have popped up to fill the demand. With average car ownership costs reaching $8,000 per year according to the AAA, Cannon argues that research showing that cars sit parked for 90% of their lives proves the need for more car-sharing flexibility. And established car-sharing firms like Zipcar, which operate their own fleets don’t feel threatened by the bill, as they are not expanding beyond urban cores and as Zipcar’s CEO puts it, peer-to-peer rentals validate the car-sharing model. But would you rent your car to a stranger?

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26 Comments on “Are You Ready For: Peer-To-Peer Car Rentals?...”

  • avatar

    But would you rent your car to a stranger?

    If I wanted to share my ride, I’d take the bus.

  • avatar

    Yes, but on two conditions: one, they (effectively, however that’s effected) take full responsibility for any extraordinary wear or damage; and two, they get screened by me for driving and car care behavior. Don’t rev when cold, hands at 9-n-3, gentle or preferably doubleclutched shifts into 1st and 2nd, that kind of thing.

    Not to a complete stranger, that’s for sure. Especially a California driver.

    But I’d perhaps be a bit less, oh… Jewishmotherly? with something that didn’t gestate in my garage for 9 months in project mode and take several thousand hours of labor to complete. This is a BMW wagon (E34 544iT/6, if we get technical). When I had a “multicolored” 86 Toyota pickup, I lent it much more willingly and with looser standards.

    I for one would be much more willing to rent to someone who rented to me, especially on a repeated basis. Say, I own a 300SDL, they own a pickup truck. They rent from me when they want to go on a roadtrip, I rent from them when I need to move bulky things. I effectively did this with aforementioned Yota and a 735i; used the latter when I had to carry passengers or make a non-hooptie appearance.

    • 0 avatar

      I’m not a fortune reader or anything but I’d guess not too many people who rent your car will double-clutch. In fact there’s an entire legion of people who have no idea of what a double clutch is let alone how to do it.

      For me personally, I’d rent out an old beater in a heartbeat. A daily driver… not so much.

    • 0 avatar

      Damn. I’m not the only person who double-clutches first gear!

      I do lend my car to a beloved ex-girlfriend on occasion, and if another friend needed it, I’d probably oblige. I have taught probably 10 kids and a few adults to use a clutch with it.

      But I do’nt think I’d rent it to a stranger.

  • avatar

    I can see this working for some. I think we should always help each other try new ideas even ones we wouldn’t use ourselves.

    I know some very savvy old car rental folks who could definately make this work for them.

  • avatar

    I have no problem loaning any of our cars to people I trust whom I know are careful drivers and who possess a solid understanding of how cars function. Of course, this is a small group that is maybe a dozen people.

    Still….. I think how well peer-to-peer rental works will depend a lot on pricing. I’m sure there’s some dollar value where I’d lend out my 9-year-old Odyssey (no tow hitch) to just about anybody who wouldn’t smoke in it. After all, people do vacation rentals of their homes/apartments and that market seems to have had a continued existence for many years.

    Thinking about it, if the “average” vehicle travels 15,000 miles a year, that is about 41 miles per day which is likely about one hour of use. That makes cars a VERY underutilized resource.

    I think a more interesting model is peer-to-peer taxi-style sharing where I would drive my own car. Using a smart phone I input my current location, intended destination, and time of departure. Folks looking for a ride with similar characteristics ping their interest and check that they agree to my conditions (e.g., no smokers, no bags that can’t be carried in the passenger’s lap, etc.). They then ride with me in exchange for a payment or credit managed through the same interface.

    DC’s slug lines are a long-existing analog to this concept as are college ride boards.

  • avatar
    bumpy ii

    Legal liability for what other people do with a vehicle which has your name on the title would be the big concern here. Assuming that is suitably remedied, something like a neighborhood co-op would work pretty well. One person buys a truck, another buys a van, someone else buys a Miata, and the rental fees go into a common pool for payments, registration, maintenance, etc.

  • avatar

    I’ve had several people approach me (in C) about car-sharing.

    Zipcar doesn’t work for them — they need a car for a longer period of time (say 3-4 days). I suppose they could use a regular care rental, but they aren’t in the city.

    If I had a place to store 2-3 cars (I don’t, my garage space is $100/M) and had a few well maintained paid off cars, I could see this working very well.

  • avatar

    Well, I will let my wife drive it occasionally – though she damaged my previous car while putting it into the garage after I allowed her to drive it home from the dealer on the first day. A stranger, not gonna happen.

    A car may well sit unused for 90% of the time, but if it were used more often, it would just wear out sooner. It’s not like the amount of “car miles” being driven is being changed. Of course, if you just need to bring in some cash, that’s a different story.

    • 0 avatar

      A car may well sit unused for 90% of the time, but if it were used more often, it would just wear out sooner. It’s not like the amount of “car miles” being driven is being changed.

      Well, I wouldn’t rent my car unless the price offered exceeded the cost of the wear and tear involved. If wear and tear is $0.50 a mile and you charge $1.00 and you rent it for 20k miles you’ll have $10k towards a new car over and above regular deprecation and maintenance.

  • avatar

    Immediately after the Loma Prieta earthquake a side road in the mountains between Santa Cruz and the bay area became impassable.

    A news story a few days after the temblor told of two high-tech exec-types in their high-cost cars stopping at the blockage and agreeing to swap cars to their mutual advantage.

    The dynamic duo traded info etc. as needed.

    Once some normalcy returned the pair returned the cars and all ended well.

    Of course, there was likely, also present, maturity, adequate intellect, proper needed morality etc. that could be harder find among the typical masses of the human herd.

  • avatar

    Napster still exists?

    • 0 avatar

      The name, logo, etc is still in use for a much more conventional and legitimately licensed music service. But no, Napster no longer exists in any real sense of what Napster was when it was still remotely relevant.

  • avatar
    M 1

    I’m going off-topic here but this stood out: “research showing that cars sit parked for 90% of their lives”

    It reminded me of something that has always annoyed the hell out of me. Between my wife and I, we have seven cars and four motorcycles. I often wonder why TWO people have to pay insurance on 11 vehicles. Granted, our situation is not typical, but I’m going to guess that not even Jack Baruth can drive two cars at once.

    • 0 avatar

      Atypical indeed, but brings up a good point. While an insurance company is insuring the value of the car, that is peanuts compared to liability insurance which is intended to insure the actual person on the policy. So why don’t we just worry about insuring the person whether they own a 1987 Honda Civic or happen to be borrowing the boss’ 2012 Bentley for the day?

      Insurance of any kind continues to prove as one of the most shady products humans have ever sold to each other, whether it’s auto, health, home, life, or otherwise. It seems to invite abuse on both sides rather than ‘insure’ responsible behavior and accountability.

      It’s been motive for murder, intentional destruction of one’s own property, tiny print that brings a coverable event to almost nothing. It’s almost the exact opposite of responsibility and charity.

  • avatar

    There are very few people I trust to drive my car. One of the best drivers I know, who also had a full career as a military pilot and used to fly the President of the United States, started in third gear twice when I let him try out my then-new car. A Ferrari driving ex-girlfriend shortened one of my cars by a foot in college. My last ex-girlfriend made a hash of driving my current car in spite of her daily driver having a 5-speed. I’m just as bad, having brought a friend’s Porsche back running on three cylinders and then later the same day blowing a tire and hitting a curb that bent the frame of his sedan. I flipped another friend’s car when the jury rigged Hurst shifter came off in my hand in a decreasing radius turn at over 100 mph. I’m also the reason people under 25 can’t rent cars, but that’s too much to go into here. Now that I resemble a responsible road user, my baggage would not allow me to be comfortable in a car sharing scheme.

  • avatar

    Great idea! I would love to buy a Panther and keep it available for the grad students in my area. Imagine, a 1099 sole proprietorship, renting your extra car to whomever needs it.

    If I were king, I’d write up a special kind of permit for it.

  • avatar

    There’s a phenomenon known as “crack rentals” or “rock rentals”. If you don’t have money to buy a rock of crack cocaine, you loan your car to your dealer, your dealer gives you the rock and drives your car around for awhile, probably selling drugs the whole time and thereby making your car “contraband” subject to seizure and forfeiture upon your dealer’s arrest.

    Similarly, I once ran into a guy who had several junky cars that he lent out to prostitutes in exchange for favors.

    I wonder if anybody stopped to think whether insurance laws like this would make crack rentals more likely.

  • avatar

    I have an old Ford Ranger that I’d consider renting out like this. It’s incredibly useful, but only a few days a month. If the rental fees would cover my ownership-expenses (which I’m sure would increase with lots of people driving it), I’d be very happy.

    RIght now, the thing is rusty yard-art 28 days a month. But those 2 days when I use it make it worth keeping.

  • avatar

    I read the bill, and it’s not allowing insurance companies to sell such policies, it’s requiring that all insurance policies allow such renting out. If people borrowing the cars are somewhat more likely to get involved in accidents, that means that to some degree everyone is going to pay that higher risk through higher premiums.

    It was already legal to sell policies that allow sharing. What this does is make it *illegal* to sign up for a policy that forbids sharing in exchange for a premium discount.

    • 0 avatar

      Thanks for reading the bill! This must be stopped if we don’t want the government to make auto insurance as affordable as medical insurance! It looks like this is just one more fiendishly disguised attempt by the left to price people out of car ownership.

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