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P2P car-rental platform zooms into city
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A new car-renting mode is gaining popularity in Shanghai. Last month PP Zuche (Car Rent), a P2P car-sharing platform, which has already rolled out service in Singapore, landed in Shanghai after hitting Beijing last August.
It provides an online platform for car owners to list their vehicles and rent them out to nearby drivers who need a car, turning private car ownership into a money-making opportunity. The scheme cuts all the paperwork car owners and renters must deal with at a brick-and-mortar car-rental company. People can easily rent a car via the website or an app installed on a smartphone.
Nicolas Wan, 32, was in bad need of a car because his black Mazda 6 was being repaired. His friends recommended PP Zuche, where Wan made his order and rented a black Volkswagen Passat for 180 yuan (US$29) a day. The car was also available for 22 yuan an hour or 1,080 yuan a week.
The Passat, as listed on the website, is three years old with a Shanghai plate and an odometer reading of 50,000 kilometers. “It would cost me around 650 yuan a day if I went to a car-rental company,” Wan says.
To rent a car on PP Zuche was straightforward. Wan first registered as a member of the website. He then uploaded photos of his ID card and driver’s license to the website, which would examine and verify the certificates within three working hours. Wan was also required to pay a 1,500-yuan deposit in case of accident or traffic rules violations before he got the contact number of the car owner.
Looking through the pages of the smartphone app, it’s apparent that one can easily get key information about cars for rent, including the car’s age, kilometer reading, hourly/daily/weekly rate, passenger number and other data. Using the phone’s GPS, a renter can choose the nearest available car.
The company claims the service easily beats traditional car-rental companies because of its quality, price and simplicity. It says the cost is cheaper and the procedure is less cumbersome than with brick-and-mortar firms.
It says people can rent a car for 30 percent less than with a car-rental company, and a private-car owner can earn more than 3,000 yuan a month by renting out his car.
PP Zuche will take a 30-percent cut of the rental fee, while car owners get the remaining 70 percent. A car owner who wants to list his car for rent must upload photos of the car with the plate, his ID card and the vehicle’s driving permit.
He also needs to pay 500 yuan for a vehicle-mounted GPS tracking device, which keeps track of the car’s route and position and lets the owner know if the rented car is out of the designated area. Auto insurance will cover all the cars registered on the platform.
Car owners and drivers do not even have to meet each other, because the tracking device installed in member’s vehicles will allow the renter to unlock the doors.
“They have branch offices in almost every district. When I’m done uploading the documents, the platform will assign an employee nearest to my place to install this device on my car,” says Zhou Shifeng, 29, in Qibao, Minhang District.
Zhou is renting out his gray Peugeot 307 at 75 yuan a day or 10 yuan an hour. With this quite low price, his car is booked seven days a week.
“It was bought three years ago with less than 30,000 kilometers. It is in good maintenance,” Zhou said. “But to earn more than 3,000 yuan a month is impossible for me because my rental is cheap even though it is rented every day.”
One of his requirements is full gas return, because “I fill it up each time before it is rented out,” Zhou says.
Legal issues
Most of the cars on PP Zuche are low- and medium-level family cars, with daily rental fees ranging from 70 yuan to 300 yuan. The cheaper, the more popular.
For the renters, PP Zuche regulates that he/she must hold a valid driver’s license for more than six months, have fewer than nine penalty points for traffic rule violations, and have no record of drunk driving or other big faults during the past three years.
If an accident occurs, money will be deducted from the 1,500 yuan deposit. If damage exceeds that amount, the company offers up to 1 million through its insurance. The car owner doesn’t need to take responsibility.
In order to protect the cars, owners and renters, a credit system is established and drivers or car owners with low credit ratings will be deprived of the right to hire or rent out cars on the platform.
Since PP Zuche landed in Shanghai last month, disputes have occurred. Renter Zhao Xinyuan tells Shanghai Daily that she rented a red BMW 3 at 400 yuan a day. When she returned the car, the owner pointed to a scratch and accused Zhao of making it.
“It was obviously an old scratch, but finally I agreed to pay for the repair cost. But the owner insisted on going to the garage he knew instead of the one the platform designated. So the cost was almost doubled,” Zhao says.
For the car owner, there is also risk. The car owner has 24 hours to check and see whether the returned car is in good condition. After 24 hours, the deposit is returned to the driver, so any disputes after that will be difficult to resolve.
In theory, the deposit and insurance systems are designed to protect both parties, but whether they work out remains in doubt. Shanghai-based lawyer Wang Weihua notes that legal issues exist. Private cars don’t have the country’s road transport business operation permit, he says, which means the operation might be illegal.
PP Zuche responded that this mode without full-time drivers is properly in the field of property rights. It is not an act of business operation.
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