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Online private car rental services driving to gain ground in Europe

Loek Essers | May 2, 2014
Online private car rental services are taking shape in Europe, competing with each other as well as the traditional rental companies. Within two or three years, most likely one of the new services will come out on top, according to some insiders.

SnappCar offers private car rentals in a way that's similar to its competitors. Prices vary from about €15 a day to €250 a day. But in contrast to OuiCar's business model, SnappCar does not take a percentage of the rental price, said Ontijd. SnappCar puts a flat €10 fee per day on top of what the car owners charge (the fee is included in the price cited online). A part of that is used for an all risk-insurance and part of it is commission.

SnappCar's insurance was specially developed with insurer Centraal Beheer Achmea for the purpose of car sharing, Ontijd said. The most important part of that insurance is that it does not affect "no-claim" aspects of car-owner policies.

No-claim insurance provisions give discounts to car owners who do not report accidents for a certain period of time. The policy developed for SnappCar prevents accidents that happen when cars are rented from affecting no-claim provisions.

SnappCar has about 40,000 users, with 7,000 cars available for rent through the site. While most of the cars on the site are available for a fee, some people also use the service to safely loan their cars to friends.

Car owners can make their car available to friends for free on the site. They just pay the €10 per day SnappCar service fee to cover insurance so owners and lenders don't need to worry if anything happens to the car, Ontijd said.

The company is already venturing across the border and launched in Germany last summer to test the waters, Ontijd said. A lack of time and resources meant the company's focus wasn't on other countries until now, but SnappCar plans to ramp things up by the end of the year, investing more effort in the German market while also launching in the U.K.

In order to do so, SnappCar needs about €3 million, of which it already has about €659,000 through crowd funding. SnappCar expects to raise the rest from investors by the end of the summer.

"We think there is room for about three P2P rental services in Europe," according to Ontijd, who estimated that it will take two to three years to determine which company will come out on top.

 

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