How to Expand Your Car Rental Business to Airbnb for Cars?

Buying a car can be costly, which is why car rental like Airbnb app and businesses have been growing! The sharing economy, which promotes sustainable living by allowing people to access common resources, is expected to see impressive growth over the coming decades. Studies show that the sharing economy’s annual compound growth rate (CAGR) is among the highest, at 28.96%, for the projected period of 2023-2028.

Although Airbnb plays a major role in the sharing economy by primarily dealing with rental properties and homestays, there is potential to launch Peer-to-Peer (P2P) marketplaces in other industries. The car rental industry market size is estimated to reach CAD 124.10 billion by 2029.

The rental car industry is expected to grow at a brisk CAGR of 3.1% over the next five years. Therefore, for those interested in entering the shared economy, creating a P2P marketplace for car rental like Airbnb, presents an attractive business opportunity.

Are you planning to launch a car rental business or shift a traditional rental service to an Airbnb-like model? Read this article, which explains everything from basic concepts to developing your own car rental app and strategies to expand your car-sharing business.

What Is Airbnb For Cars?

When Airbnb was launched, it revolutionized the concept of sharing by transforming everyday resources like rooms, homes, and spare spaces into income-generating properties. This sparked a wave of platforms similar to Airbnb, including car rental markets. These platforms adopted Airbnb’s model for cars, allowing owners to lease their vehicles to visitors or locals.

Car rental like Airbnb is a peer-to-peer car-sharing platform that allows members to lend their vehicles to others. In simple terms, it enables car owners to earn money by renting their cars, while also providing a convenient and fast option for those in need of a rental.

Unlike Uber or Lyft, which are ride-hailing apps, Airbnb for cars operates more like traditional car rental systems. It’s ideal for long-distance travel, offering a modernized approach to planning your trips in advance.

Why Launch an Airbnb for Cars?

The car rental industry insights reveal a growing demand for rental cars, highlighting new commercial opportunities. In addition to this data, there are several other reasons to consider launching a Peer-to-Peer business model, similar to Airbnb, for car rentals.

Asset-Light Business Model

Launching an Airbnb for cars is extremely asset-light. The term “asset-light business model” refers to businesses where the owner invests minimal capital. In a car rental marketplace, the platform owner only needs to cover platform fees and business registration, while individuals who own cars provide their vehicles for rent.

Low Competition

There are many established car rental companies like Enterprise and Turo, which mostly operate in the B2C market. For example, 9 out of the top 10 car rental companies only offer B2C services, meaning individual car owners are not able to advertise their vehicles for rent. This creates an opportunity to establish a Peer-to-Peer car rental market that can compete with the top players in the industry.

Inflation

Due to high inflation rates, many people have turned to side hustles to meet their financial obligations. However, when it comes to renting cars, it’s not just a side job for many people, it’s a passive income stream. Car owners don’t need to be actively involved in the business. This makes launching a car rental app like Turo a highly lucrative business idea.

Increase in Car Ownership Rates

Car ownership has been rising globally. Countries like Poland, Italy, Australia, Canada, and France follow closely behind. In the 90s, most households could afford one car, but today, it’s common for families to own several. In many developed cities, it’s not unusual for a family member to own three or four cars.

When someone in a family owns multiple cars, there’s a high likelihood that at least one vehicle will remain idle in the garage. This creates a great opportunity for businesses to help car owners rent out their vehicles through a Peer-to-Peer car rental marketplace.

All-Season Business

Another strong reason to launch a P2P car rental like Airbnb is that it operates year-round. Whether it’s spring, summer, autumn, or winter, the demand for rental cars remains consistent. While other businesses may experience declines during off-peak seasons, the car rental industry typically sees a steady rise in demand. Investing in a P2P car rental marketplace guarantees year-round returns, helping to build a durable business.

Benefits of Car Rental Mobile App Development Like Airbnb

Investing in the development of a car rental mobile app is a smart decision, as there is significant potential for growth. Here are the main benefits that come with creating a mobile car rental application:

Higher Customer Engagement

Customer engagement improves when users interact with an online platform. It’s easier for customers to access information, make reservations, and manage rentals based on their preferences. This makes car rental services more accessible and convenient.

Better Customer Experience

The user experience on a mobile app is far superior to the manual process of booking a car. The app provides a more convenient, user-friendly, and seamless experience, which boosts client retention and satisfaction.

Higher Visibility and Reach

Traditional rental businesses are often limited to serving customers in their local area. However, with a car rental like Airbnb app, your reach expands nationally and even internationally, allowing you to target a much larger audience.

Enhanced Brand Recognition

The car rental industry is highly competitive. With a mobile app, you can differentiate yourself from the competitors and build a stronger reputation for your brand. A well-designed app can reinforce your brand values and improve your overall image.

Data Collection and Analysis

Mobile apps like Turo enable you to collect valuable data from your users. This data can be used to create personalized experiences, as well as to analyze customer behavior, usage patterns, and preferences, helping you tailor services to meet their needs.

Streamlining Operations

Managing a car rental business through traditional methods can be cumbersome. Relying on phone calls and in-person interactions can make it difficult to scale your business. A mobile app streamlines operations by allowing you to manage everything from one central platform, making business expansion much more efficient.

Must-Have Features of a Car Rental App Like Airbnb

Car rental like Airbnb, offer a range of opportunities. Below are the essential features that should be included in a car rental app, either from the start or after launch.

Car Reservations

Users should have an easy and seamless way to register in the app, just like with Airbnb. Based on their preferences, users should be able to make reservations effortlessly. The app should display essential information, such as registration by email, a verification link, user ID, contactless check-in options, and more. Additionally, it can show discount offers for guests and payout details for each user.

Car Facilities

Not everyone wants the same type of vehicle! Providing consumers with a variety of vehicle options, including a “near me” feature, is crucial. Offering different car types for reservation will greatly enhance the user experience and make your business more attractive.

Geolocation Integration (GPS)

Using GPS technology can solve many key issues. It allows users to easily locate nearby vehicles and order a car without needing to enter an address each time. Users can also track the vehicle’s location, making the process more efficient.

Booking Process

The booking system should handle a large amount of data seamlessly while remaining user-friendly. It should allow customers to easily reserve the car of their choice with just a button click, adjust waiting times, modify booking parameters if needed, or cancel reservations with ease.

Payment Systems

Integrating electronic payment methods into your rental car app is essential. Options like PayPal and credit cards are popular choices. You could also allow for cash payments when the renter picks up or drops off the vehicle at the rental location.

Car Rental Details

In times of uncertainty, inflation, and market changes, it’s difficult to keep rental car prices fixed over time. For this reason, the app should include up-to-date details on car rental prices and availability, helping to keep both owners and renters informed.

Document Verification

When renting a car, vehicle owners need to verify the renter’s identity and eligibility. Instead of requiring physical copies of documents like driving licenses and passports, allow users to upload documents within the app for easy verification and a smoother process.

Account Management

This feature of car rental like Airbnb app benefits car renters by providing a comprehensive guide for their journey. The app should offer everything from booking to insurance plans for emergencies. It should also allow users to track their travels and destinations at any time.

Late Cancellations Management

Late cancellations can result in financial losses for owners due to the processing of orders, cleaning, maintenance, or refueling of the vehicle. To avoid losses, establish a clear cancellation policy with tiered fees depending on the time of cancellation.

Late Returns Management

Late returns can lead to lost opportunities for the vehicle owner. Therefore, it’s essential to have a system in place for custom late return dates, along with applicable fees to cover any lost rental time.

Rental Add-ons

By providing additional products and services like child seats, air fresheners for cars, WiFi and window blinds. Providing these add-ons is a great way to boost revenue and enhance the user experience, much like the Airbnb model.

Maintenance Buffer Period

The app should include an automatic maintenance buffer period after the vehicle is returned. This allows time for necessary checks and inspections before the vehicle is added back to the inventory. Once the maintenance is complete, the car should automatically sync back to the online inventory.

Inventory Management

A car rental app should allow you to establish an interval for maintenance. This time period is automatically set when the customer has returned the car, and it can be utilized to conduct any required examinations and checks. When the maintenance time is completed, the vehicle will automatically be synchronized to the inventory online.

Tips To Expand Your Car Rental Business To Airbnb For Cars

The car rental industry is made up of both small and large rental companies. However, the experience of renting from a traditional rental business differs significantly from renting from an individual peer. In this section, we will discuss how to expand your car rental service and build an Airbnb-like model for cars.

Start a Business Using the Airbnb Model

If you want to use the model of booking cars like Airbnb, first create a website and app to book cars with the help of an established app development firm. They can help you develop your ideas for a business app correctly.

It is possible to review and extend your requirements depending on the requirements of various people who rent the cars. This will support the development of an entrepreneurial venture and help new entrants join the market. A well-designed Airbnb-like application for car rentals will provide users with a wide range of features.

Look For Prerequisites to Start a Car Rental Business

There are a few things the business must do in order to start. Here are three most important aspects that you must consider before starting your own car-sharing business. In addition, you might be required to modify the checklist depending on your progress.

• It is important to be aware of certain criteria since it’s an extensive sector. You must also target the customers you serve, and analyze your competition in the market.
• You’ll require an online platform (the mobile or website), a domain name to identify the URL of your site, and a host for your own webpage together with the business and business partners.
• The creation of a website or app should be the primary goal of entrepreneurs. It should offer excellent features and services for maintaining the operation, as well as supporting the car rental website or app online. After that, you will be able to create your own business plan to run your business of renting cars.

Prepare Airbnb Revenue Script Model

In order to increase your chances for making your vehicle brand famous and recognizable, you must think about revenue script which is one of the crucial aspects. If you make use of the tools to  develop a website you’ll earn a profit. By utilizing the right tools to develop a website and app, you can generate profit.  The revenue typically comes from both vehicle owners (hosts) and users. Most of the time, it’s a result of charges which are imposed by both owners as well as consumers in a variety of methods.

Different Types of Car Rental Apps

There are many types of car rental apps, and you can choose the business model that best suits your needs. Below are some of the most popular types:

Self-Driven Car Rentals

 Self-driven car rental apps allow customers to rent cars and drive them on their own, instead of being driven by someone else. This model is particularly popular with holidaymakers and those who prefer the privacy and freedom of driving themselves.

Corporate Car Rentals

Corporate car rental apps are designed for businesses, corporations, and organizations that need cars for employee travel. Unlike self-driven car rentals, corporate car rentals usually provide chauffeur-driven vehicles to ensure employees are driven in comfort and style during business trips.

Outstation Car Rentals

Outstation car rental apps enhance the travel experience by offering rental vehicles for intercity or outstation trips. These apps often offer one-way rentals, multi-day options, and partnerships with outstation suppliers to make long-distance travel convenient and affordable.

Ride-Hailing App

Ride-hailing apps allow users to hire a vehicle with a driver to take them from one location to another. These apps typically offer an on-demand service, but some now also allow customers to book rental vehicles, giving them a broader range of options for their transportation needs.

Peer-to-Peer (P2P) Car Rental App

Peer-to-peer car rental apps allow individuals to rent out their personal vehicles to other users. In this model, the car rental business does not own the vehicles but facilitates the rental process between private car owners and renters. Vehicle owners can earn money by listing their cars on the app, which is especially useful for those who don’t use their cars frequently.

Steps to Create a Car Rental App Like Airbnb

Making a car rental app like air b and b car requires following is a sequence of steps that are organized that are each essential to ensure the success of its launch and successful operation. Below is a thorough detail of each one:

Market Research

Conducting extensive market research is the fundamental step for developing the car rental application. Consider analyzing competitions such as Hertz, Enterprise, and Zipcar. Examine their offerings prices, pricing plans, consumer reviews, and advertising strategies to determine what is working and what’s not.

Define Core Features

After you’ve got a good knowledge of market trends about car rental like Airbnb app, it’s time to determine the key features of your application. It is essential to have features that allow users to register and login options, so that users are able to create accounts and utilize social media logins.

Design the User Interface (UI)

The user experience is very important. Begin with wireframes to define the layout of the app and users’ journeys, making sure there is an orderly flow between browsing and making reservations. Concentrate on creating a clear and intuitive interface that is focused on interactions with the user, and use instruments such as Figma and Adobe XD for prototyping.

Choose the Technology Stack

The selection of the technology stack is vital to the application’s speed and capacity. As for the front-end frameworks, such as React Native or Flutter are well-known for their ability to develop multi-platform apps using a single codebase. Based on the expertise of your team and requirements for the project, you might consider making use of Node.js, Python, or Ruby for the backend.

Develop the App

Using an agile method throughout the development process permits iterative improvement as well as the ability to adapt to changing conditions. Begin by creating the frontend and ensuring that the application is responsive and visually aligned to the design. In parallel, you should set up your backend and create the server’s architecture as well as APIs which facilitate communication between your frontend and the backend during the development of your app.

Testing

Quality assurance is a crucial measure that needs to be considered. Perform thorough testing, which includes integration tests, unit tests, as well as the testing of user acceptance (UAT) in order to make sure the app features function in the way they were intended to. 

In this stage, you will be able to identify and address bugs, while also optimising performance to increase the user experience. If you have completed your internal tests, consider the possibility of launching a beta version of the application to a selected user group.

Launch the App

Making preparations for the launch requires many steps from submission of your application to Google Play Store and Apple App Store and ensuring that all the requirements for compliance are fulfilled. Each platform has its own guidelines to follow and a thorough planning is crucial.

Post-Launch Support

When the car rental like Airbnb app launches, support and ongoing maintenance is essential for the long-term viability of the app. Examine the performance of your app with analytical tools that track customer engagement, patterns for booking as well as potential problems.

Scale the Business

If your users’ numbers increase, think about strategies to expand your company. This could involve increasing the fleet of vehicles in your company and introducing new services such as loyalty programs, as well as integrating other services such as insurance choices.

Compliance and Legal Considerations

It is also essential to consider the legal requirements of running the car rental company. It includes getting the required permits and adhering to the local laws regarding car rentals.

Conclusion

Car rental is an industry that is growing rapidly and has a tremendous opportunity. This is why it’s a great investment opportunity in the application development of car rental apps. In order to differentiate your application within the crowded rental car marketplace, you must study the elements that have contributed to the success of Airbnb, identify the gaps in the market, and provide users with a personalized experience using innovative tools.

The main areas to be considered for the process of launching the P2P car rental business is developing the best app and the speedy onboarding of customers. As more people recognize the benefits of renting cars from peers, the entire car rental market is likely to expand. With limited competition in certain areas, now is the ideal time to invest in a P2P car rental marketplace for your business. Moreover, due to its low-risk nature, running an Airbnb-style rental service for cars is cost-effective and presents an excellent business opportunity.