App Idea 3: Rent My Car

July 7th, 2021

Here’s a business idea in one of the biggest untapped markets.

The Problem

People in highly-populated cities don’t always own cars.

In San Francisco, only 70% of the population owns a car.

These non-car owners use public transport to get around.

But what happens when they need to get somewhere further? Like go on vacation, or go outside the range of the public bus route?

One thing they can do is rent a car from an company like Hertz or Enterprise.

Solution

An alternative is to rent a car from the people who do own a car.

So basically people in the area can put there car up for rent (like putting your house up for rent with AirBnB).

Competitors

This business idea is already under way with companies like HyreCar, Turo, and GetAround.

A simple search on GetAround shows that 367 people listed their car for rent in the San Francisco Bay Area.

It’s easy to list your car.

The Twist

Why are we focusing on this semi-saturated market?

Because there is huge potential for this idea in South America.

There are cities in South America with some of the largest populations of non-vehicle owners.

The largest city in South America is Sao Paolo, Brazil, and only 40% of the Sao Paolo owns a car.

That’s more than 70 million people who do not own a car.

You can only comprehend the huge potential visually.

Let’s compare Sao Paolo to San Francisco.

Untapped Potential

Let’s calculate the potential by using the data we found on Turo’s website.

The ratio between San Francisco’s non-car owners and Sao Paolo’s non-car owners is 260,000 to 70,000,000, which we can reduce to 1 to 269.

If Turo had 367 car listings in San Francisco, and if Sao Paolo were to follow the same trend, then Sao Paolo would have 98,728 listings.

How long would that take?

Turo formed in 2009. So it would probably take around 10 years to get up to 98,000, if you can handle all of the web “traffic.”

Other Cities

That’s just Sao Paolo.

Imagine the other large cities.

In Bogota, Colombia, there are almost 2 million people who do not own a car.

In Lima, Peru, there are about 10 million people who live in the city and the majority do not own a car.

Don’t Forget This

The next step to study would be what the travel habits are for people in these cities.

They do travel large distances to visit family, perform government tasks (like getting visas and maintaining businesses), and doing business (the majority of South Americans own a business).

You would also need to consider insurance companies who would cover your vehicles.

Would the insurance companies for HyreCar, Turo, and GetAround cover South America too?

Are there big insurance companies in South America who would cover a business like this?

What are the risks for renting in South American cities?

These are factors you will want to look into if you want to pursue this untapped market.

If this is an idea that appeals to you, message us for a free consulation.