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Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
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JayMillz Offline
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Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
http://gma.yahoo.com/rental-car-co-run-t...19464.html

Said three teenagers to themselves last year: "Yeah, sure, we could go to college. But wouldn't it be more fun to up-end the airport rental car business?"

They opted for the latter.

So positive were they that they had happened on a better business model than Hertz or Avis, that they turned their backs, respectively, on Harvard, Princeton and MIT -- the three institutions to which they had gained (or been offered) admission.

The idea was this: At every major airport, acres of cars sit idle, left parked by owners who have jetted off. Why couldn't these same cars be rented to arriving travelers? Rates could be dramatically cheaper than those charged by traditional car rental companies, since, under this model, the rental company wouldn't have to pay for or maintain the fleet.

Owners would have a fourfold incentive to participate: free parking, a free car wash, a cut of the rental fee and a guarantee their car would be waiting for them when they returned.

With financing from angel investors, FlightCar, the trio's brainchild, began renting cars in February to passengers arriving at San Francisco International Airport (SFO), for rates start as low as $21 a day, depending on the make and model of the car.

"We're shooting for one more airport before the end of this year," says Zaparde.

Foes of FlightCar, however, have started to shoot back.
It's easy to see how traditional rental companies might not be amused to have their prices undercut. But San Francisco International is crying foul, as well.

Doug Yakel, public information officer for SFO, tells ABC News that FlightCar refuses to play by the rules that govern other rental car companies. It doesn't pay the same fees, he says, and it doesn't abide by the same regulations.

SFO's objections have taken the form of a complaint filed last month against FlightCar by the city attorney of San Francisco.
Zaparde says the airport's lawsuit stems from a disagreement over how to define FlightCar.

"They want to put us in the same bucket as traditional rental companies," he says.

FlightCar is a different animal from Avis or Hertz, he adds, and thus not subject to the same strictures.

For example, SFO wants FlightCar to pay it 10 percent of its gross profit and a $20 fee for each rental car transaction -- the same as what the airport gets from every other rental car company.

The fact that FlightCar operates from a base outside airport property, Yakel says, makes no difference: SFO has three other rental companies that also operate off-property. According to the complaint, those three paid SFO over $2 million in fees in 2012. FlightCar, too, should pay, thinks Yakel.

The fact that it does not gives FlightCar "an unfair advantage over similarly situated businesses that are forced to charge higher prices in order to operate lawfully and fairly," according to the complaint.

Deputy City Attorney Jennifer Choi tells ABC News that FlightCar's response is due July 1, and that, if no resolution is reached by then, a court will decide if the company is in violation of California's Unfair Competition Law. If found to be in violation, the company could be fined and/or shut down.
(This post was last modified: 06-19-2013 03:04 PM by JayMillz.)
06-19-2013 02:42 PM
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JimNortonFan Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
Hertz and Avis should get off their rear ends and lobby the government to regulate these kids out of business. That's the American Way.

Maybe they can team up with SFO to destroy these kid's dreams and make sure Avis and Hertz executives get bigger golden parachutes.

Go free market!

America, Fuck yeah!
06-19-2013 02:49 PM
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Sebastian Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
Who's going to rent their wife (your car) to some strangers?

I guarantee it will come back without any damages. but I might drive it kind of rough since it's a rental anyways.
Would you rent it to me for some $? Maybe if you have a beater car that doesn't worth that much...

I wonder how they are going to price it for too many cars.
1989 honda civic with loose transmission and sagging interiors $??
2013 scion with soft leather interior w/o sun damage and tight gears $??
06-19-2013 03:09 PM
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Menace Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
(06-19-2013 02:49 PM)JimNortonFan Wrote:  Hertz and Avis should get off their rear ends and lobby the government to regulate these kids out of business. That's the American Way.

Maybe they can team up with SFO to destroy these kid's dreams and make sure Avis and Hertz executives get bigger golden parachutes.

Go free market!

America, Fuck yeah!

That is, in fact, what is happening to them. Except it's not Hertz and Avis, but the SFO authority because these guys are not paying the airport the rental fees and profit % that the standard rental companies pay. SF has sued them.
06-19-2013 03:13 PM
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Laner Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
Quote:I wonder how they are going to price it for too many cars.
1989 honda civic with loose transmission and sagging interiors $??
2013 scion with soft leather interior w/o sun damage and tight gears $??

I would imagine they would have the car owner set the price. Similar business model to Air BnB, which is also having city trouble with a city, NY.

Cant stop the flow. This is the here and now of fluid and movable business.
06-19-2013 03:19 PM
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Sebastian Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
I don't see the problem with that.

Those major car rental companies are their tenants. It is their best interest to protect them since they get the % from the rental price.

Some guy is running a rental business out of their (SFO) parking lot. it affects the car rental companies and so does SFO?
That is what SFO should do! Stop these guys.
(this is real life guys. you want to start up some taco stand close to some guy? he will do whatever he can to stop you. it's that fierce even for a fucking taco stand)

This is what these kids should do. There are some parking lots close to the airport ran by an individual. they offer cheaper rates but you have to take a shuttle to the airport.

They should rent a parking lot and they can do whatever the fuck they want as long as the customer agrees to rent their cars to some strangers.
(maybe they can let their employees hangingout by the airport Drop Off area. the customer hands the key to the person and he can bring it to their parking lot)

Anyways, there are too many hassles, I don't think it's going to work out.
Most cars sit in the parking lot from 9~5pm. someone probably can develop a program for people to share cars. but it won't happen since it's a Car! (insurance, damage, mechanical problem etc)



(06-19-2013 02:49 PM)JimNortonFan Wrote:  Hertz and Avis should get off their rear ends and lobby the government to regulate these kids out of business. That's the American Way.

Maybe they can team up with SFO to destroy these kid's dreams and make sure Avis and Hertz executives get bigger golden parachutes.

Go free market!

America, Fuck yeah!
06-19-2013 03:26 PM
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MikeCF Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
(06-19-2013 03:09 PM)Sebastian Wrote:  Who's going to rent their wife (your car) to some strangers?

Plenty of people.

I rented my crib out on Air BnB.
06-19-2013 03:30 PM
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
Geez! 2009 porsche cayenne $33 a day! I would rent this even though I don't need a car since I can drive the heck out of it.
ROFL at porsche owner trying to make $10 a day from this car.
06-19-2013 03:34 PM
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UgSlayer Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
Sounds like a great idea. The new generation is bound to have business-minded people. They see a dismal economy and shrinking job market, so they decide to hustle on their own.

I see this as a new trend, a sort of pendulum effect from young people seeing the generation before them being fucked over and hood-winked by huge companies and the tertiary education system.
(This post was last modified: 06-19-2013 04:20 PM by UgSlayer.)
06-19-2013 03:36 PM
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renotime Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
The great thing about lean start ups is that they can make iterations seamlessly.

These dudes will find a way around this and prosper.

Our fear of death is so great that we fatally wound ourselves when trying to run from it.
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06-19-2013 05:50 PM
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JimNortonFan Offline
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RE: Rental Car Co. Run by Teenagers Undercuts Hertz, Avis
Aren't the parking spots there for the convenience of the passengers?

Is the rental car company convenient for passengers?

What's the problem here?
06-19-2013 06:11 PM
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