Would you rent your own car if you weren’t using it? Or forgo car ownership and borrow your neighbor’s car instead? A new peer-to-peer car sharing service is promoting the concept of privately-owned vehicles as communal community resources, letting car owners make money from their cars by sharing them with strangers.
Instead of acquiring a new car — or creating demand for a rental car service buy a new car — you use an existing one car. Car owners profit from sharing by pocketing the rental fee minus a 15 percent commission paid to RelayRides. The Cambridge, Mass., startup is backed by Google Ventures, among other investors. The company is building on a trial run in Massachusetts, where 50 participants are renting out vehicles to 1,000 borrowers. The concept works like Zipcar Inc. and other services that use the Web to rent cars by the hour, except RelayRides doesn’t have to buy its own fleet.
Here’s how it works:
Car owners sign up with RelayRides and have a device installed in the car that lets renters unlock the vehicle with a membership key, as one does with Zipcar. It also tracks mileage and includes a GPS location chip. The car is also outfitted with an immobilizer that prevents anyone from starting the vehicle without a reservation.
Owners go online to specify the times their car is available and the rates they want to charge. They’re responsible for paying for the gasoline renters use and are on the hook for any damages to the car up to $500. RelayRides vets the driving records of renters, who pay a mileage charge if they travel more than 20 miles in an hour.
RelayRides estimates that owners that rent their car for 10 hours a week can earn between $2,300 and $3,700 annually, depending on the type of vehicle.
Insurance policies, not technology, had been the obstacle to peer-to-peer car sharing. But a law passed this year in California allows people to earn money from sharing their car without automatically voiding their insurance policies. RelayRides, however, insures each car owner participating in the program for up to $1 million.
So, readers, what do you think? Would such a program work in any communities in New Jersey?