Leasing companies need to adapt to peer-to-peer car sharing

Banks and leasing companies need to review their terms and conditions to facilitate the creation of a sharing economy, according to a peer-to-peer car sharing service.

Car & Away operates from two major airports in the UK, and has plans to expand, but restrictions in lease agreements are preventing many vehicle owners from joining the scheme.

Graeme Banister, mobility and partnerships director, Car & Away, said the finance industry needs to unlock the capacity in the vehicle parc and remove the restrictions that prohibit leasing customers, both corporate and private, from sub-hiring their vehicles to third parties.

“We are in a position in the world where we should be doing more with existing assets, rather than trying to put more cars on the road,” said Banister.

Interestingly, some lenders are exploring opportunities in this area. U-Go by Leasys, the FCA Bank subsidiary, haslaunched a peer-to-peer sharing option for owners of the Alfa Romeo Giulietta. The service is live in Italy and was scheduled for a September launch in the UK.

The Airbnb model

In the wider economy, Banister cited Airbnb as a model that had successfully shown how people can sub-let assets in a trusted, peer-to-peer environment.

As a launch strategy Car & Away has focused on the sharing of vehicles parked at airports, where owners have no use for their vehicles while they are abroad, and where there is a steady supply of inbound rental customers.

The airport model also allows Car & Away to manage the process more closely than keyless peer-to-peer offerings. Owners leave their vehicles with a concierge who inspects, cleans, rents and then valets the car again before the owner returns. Car & Away sets the pricing and takes a 40% commission. It also temporarily installs a telematics box in the car, and provides its own Allianz insurance cover during any hire period.

Neighbourhood expansion

Looking ahead, the company plans to expand beyond its airport base to develop peer-to-peer car rental in urban neighbourhoods.

“There is a huge opportunity to create partnerships with owned fleets, which can profit from the spare capacity in their vehicles,” said Banister.

Rental savings for customers

Corporate renters can also save on hire fees – Car & Away claims its rates are up to 60% cheaper than those offered by airport rental firms. In addition, renters can select a specific vehicle to meet their needs, rather than reserve a category of car. A spot check of cars available for hire at Gatwick airport ranged from £36.22 (€41) for two days in a Volkswagen Polo to £111.74 (€126) for the two-day hire of a Range Rover.

“Car & Away is at a real turning point in its growth so creating sustainable partnerships with companies that enhance the Car & Away proposition is vital at this stage,” said Banister. “Shared assets are better assets and I look forward to working with companies from across the mobility ecosystem to bring the benefits of sharing to as many people as possible.”