Cars Are Next Frontier For Sharing Services

Cars Are Next Frontier For Sharing Services

9:57am Dec 27, 2013
Kevin Petrovic, 19, and his business partner, who's also 19, raised about $6 million from venture capitalists in Silicon Valley to launch FlightCar. The company is trying to make its mark with car-sharing for travelers.
Kevin Petrovic, 19, and his business partner, who's also 19, raised about $6 million from venture capitalists in Silicon Valley to launch FlightCar. The company is trying to make its mark with car-sharing for travelers.
Chris Arnold / NPR

Following the popularity of companies like Airbnb, which rent out a client's house or apartment to people visiting the area, more companies are trying the idea with cars. Companies like Uber help find someone to drive you around like a taxi. Another will let you rent out your car like a Zipcar while you're at work.

Now FlightCar is trying to make its mark with car-sharing for travelers. Instead of paying to park at the airport, you can bring your car to FlightCar and park for free, and the company will try to rent it out while you're away. That way you and the company can make money from the rental.

Constance Mussells of Rhode Island pulls into the FlightCar parking lot near Boston's Logan International Airport. She's heading to Florida for vacation and is dropping off her 2002 Mercedes station wagon.

"I'm going away for a couple of weeks. I went online and I found this, and I thought I'd give it a shot," she says.

FlightCar's co-founder, Kevin Petrovic, 19, of New Jersey, was admitted to Princeton but deferred enrollment to help launch the company. Pretty quickly, Petrovic and his business partner, who's also 19, managed to raise about $6 million from venture capitalists in Silicon Valley.

"There's really no fundraising climate quite like the San Francisco Bay Area," Petrovic says. "It's just unequaled anywhere in the world. So that's why we went there, and that's why we raised most of the money there too. Because that's where people really I would say are crazy enough to dump massive amounts of money into this kind of thing and hope it works."

So far, FlightCar is operating at three airports — Boston, San Francisco and Los Angeles. It has run into a legal skirmish in San Francisco. After you drop your car off at FlightCar, a black Town Car taxi takes you to the airport for free, and the airport in San Francisco wants FlightCar to pay for drop-off rights.

The company is fighting that because it says it needs to keep costs as low as possible. Unlike Airbnb, where you might spend more than $1,000 to rent a house or apartment, there's less money involved with renting a car.

"We're not making money, we're not profitable — we're working on it," Petrovic says. "To be profitable in the rental industry, it's difficult. A lot of things you can only accomplish at scale, but we are working toward all those things."

Petrovic says at the San Francisco location, they're doing 70 or 80 transactions a day. And over Thanksgiving, the company had 300 cars parked or rented there.

In Boston, Jen Chaplin is just getting off a flight and picking up a Toyota Corolla to rent. She went online and picked FlightCar because of the price. The cost to rent the Corolla is $200 for 10 days — that's $20 a day.

So, can FlightCar make money renting cars that inexpensively while paying car owners and dealing with other expenses — which, by the way, includes a car wash? It'll return your car vacuumed and scrubbed down.

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Transcript

DAVE MATTINGLY, HOST:

Perhaps you've heard of the company Air BnB. People rent out their house or apartment short term to visitors who might otherwise stay in a hotel. This year, the car became the new frontier for sharing services. Companies like Uber now help you find someone to drive you where you need to go. Another service lets you rent out our own car, like a Zipcar while you're at work.

In the coming year, you may hear about a company called FlightCar. NPR's Chris Arnold reports.

CHRIS ARNOLD, BYLINE: The idea behind FlightCar is this. Instead of paying to park your car at the airport, if you bring it to FlightCar, you can park for free and they'll try to rent the car out to other people while you're away so you and the company can some make money from the rental.

UNIDENTIFIED MAN: (Unintelligible) the car. If someone does end up renting you car, you're going to get an email saying, you know, hey, your car's been rented. So when they return the car, I'm going to pull out all your pictures and confirm that the car is exactly the way you left it.

CONSTANCE MUSSELLS: Thank you.

UNIDENTIFIED MAN: Awesome.

ARNOLD: Constance Mussells from Rhode Island has just pulled into the FlightCar parking lot near Boston's Logan Airport. She's heading to Florida for vacation and she's dropping off her 2002 Mercedes station wagon.

MUSSELLS: I'm going away for a couple of weeks and then I went online and I found this and so I thought I'd give it a shot.

ARNOLD: And so you just saw this online and thought, well, hey, rather than spend 20 bucks a day, maybe I'll make 10 or 20 bucks a day.

MUSSELLS: Exactly.

ARNOLD: One of the co-founders of FlightCar is Kevin Petrovic, and here's the only-in-America part of the story. Petrovic is just 19 years old. He's from New Jersey. He got into Princeton, but deferred enrollment to launch this company. Then pretty quickly Petrovic and his business partner, who is also 19 years old, managed to raise around $6 million from some venture capitalists in Silicon Valley.

KEVIN PETROVIC: There's really no fundraising climate quite like the San Francisco Bay Area. It's just unequaled anywhere in the world. So that's why we went there, and that's why we raised most of the money there as well. Because that's really where people sort of, I would say, are crazy enough to, you know, dump massive amounts of money into this kind of thing and hope it works.

ARNOLD: So far, FlightCar is operating at three airports - Boston, San Francisco and Los Angeles. It's run into a legal skirmish in San Francisco. After you drop your car off at FlightCar, a black Town Car taxi takes you to the airport for free and the airport there wants FlightCar to pay for drop-off rights.

The company is fighting that because it needs to keep costs as low as possible. Unlike Airbnb, where you might spend more than $1,000 to rent a house or an apartment, with renting a car there's a lot less money involved.

PETROVIC: We're not making money. It's not profitable, but we're working on it. Obviously, to be profitable, especially in an industry like the rental industry, it's difficult. A lot of things you can only accomplish at scale, but you know, we're working towards all those things.

ARNOLD: Meanwhile, Petrovic says at the San Francisco location they're doing 70 or 80 transactions a day. And over Thanksgiving, the company had 300 cars parked or rented there.

PETROVIC: So that was really cool. Definitely, you know, a lot of cars there, a lot of people are loving the service.

ARNOLD: In Boston, Jen Chaplin is just getting off a flight and picking up a Toyota Corolla to rent. She went online and she says picked FlightCar because of the price. Looks like a pretty nice Toyota Corolla. How much are you paying to rent it?

JEN CHAPLIN: $200 for 10 days.

ARNOLD: That is pretty good.

CHAPLIN: Yeah.

ARNOLD: Twenty bucks a day.

CHAPLIN: Right. Can't be beat.

ARNOLD: So the only question remaining is can FlightCar actually make money renting cars that cheap while paying the car owners and dealing with all the other expenses? Which, by the way, includes a car wash. They'll give your car back to you all vacuumed and scrubbed down. Chris Arnold, NPR News, Boston. Transcript provided by NPR, Copyright NPR.

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