The sharing economy has changed the taxi industry with Uber and Lyft. The hotel industry has been flipped upside-down with Airbnb.
Is the car rental industry the next target of a sharing revolution?
More and more services are popping up that allow car owners to rent their cars out online. This completely eliminates the need for traditional car rental companies.
This is great for two reasons. First, it makes renting a car way easier. And second, it makes it possible to make extra money with your car with little work. In fact, some car owners have reported making over $10,000 a year. That is more than enough to pay off your car payment, keep up with maintenance, and pocket some money!
One car rental place we have covered in the past is Turo. We previously covered how to use Turo as a renter. In case you missed it, the article discusses how Turo can be used for personal use and the benefits of doing so. One of the biggest takeaways readers got from this article was drivers cannot rent a car on Turo and use it to drive for Uber and Lyft.
Now that we have that out of the way, let’s discuss what it is like to rent out your vehicle on Turo.
- What Is Turo
- How Does Turo Work (For Owners)
- Turo Car Requirements
- How Much Money Can You Make With Turo?
- What if Something Happens to my Car?
- Is Turo Worth It?
What Is Turo?
Since the company’s conception in 2009, Turo has become known as the luxurious way to rent a vehicle. They achieved this by being selective about the types of automobile listed and how those vehicles are used. Turo is often called the Airbnb of car rentals, primarily due to the way the platform is set up.
Of course, people associate Turo with vacations too. Namely, Turo is marketed as a vacation enhancing tool capable of embellishing a weekend getaway. By taking this stance, Turo is able to attract a plethora of renters based out of their headquarters in San Francisco.
Automobile owners are able to capitalize on this attraction too. One noteworthy example includes car payments. According to Turo, people are able to pay off a good portion of a car payment by renting out their vehicle a few times a week. In essence, this means that a recently purchased automobile has the potential to pay for itself over time, which is pretty cool.
How Does Turo Work for Car Owners?
If you’ve ever used Airbnb, Turo will seem very familiar. Essentially, it is a peer-to-peer car-sharing service, much like Airbnb is a peer-to-peer room-sharing service.
After automobile owners set up their account on Turo the next step is to list your car. Car owners need to describe their vehicle’s specifications and add a few pictures of the vehicle. You also get to set your daily rental price.
From there, owners should assure that their calendar is up-to-date to reduce the likelihood of getting pickup dates out of order. Once you have confirmed that everything is aligned properly, start accepting orders! Review requests as they come in and filter out requests you do not want.
There are no penalties for denying a request.
When you do finally accept a request, it is time to schedule a pickup with the renter. At the meetup location, be sure to check their license, walk with them around the vehicle, and review the gas as well as mileage. Confirming the status of the car is reassuring to both you and them, so do not skip this part of the process.[su_youtube url=”https://www.youtube.com/watch?v=cGRNMIp1Xis” width=”560″ height=”320″]
Now that the renter is well on their way, go about business as usual while you rack in that sweet, sweet cash! Rest assured knowing that Turo takes care of the liability insurance up to $1 million. If that is not comforting enough, the car rental company also provides 24/7 roadside assistance for renters.
Assuming everything goes as planned, renters will return your vehicle on the scheduled date. At this point in time, repeat the process conducted at the original meetup.
Upon knowing for sure that the vehicle is no worse for the wear, send the renter on their way, and be sure to submit a review on Turo. Doing so grows the community and increases the likelihood of good renters being able to do so again in the future.
When all is said and down, Turo will automatically pay you. It’s a simple way to make more money will little extra work.
Turo Car Requirements
Now that we have addressed how Turo works, let’s review the fine details of the service. As we have mentioned, this car rental service is fairly selective about which vehicles can be listed. If your automobile matches any category below, it cannot be rented on Turo.
- Passenger vans
- Cargo vans
- Box trucks
- Recreational vehicles (RVs)
- Vehicles that require a commercial license to operate legally on public roads
- Vehicles designed primarily for off-road use (e.g. Ford F-350s)
- Certain makes and models, such as the Lotus
- Farm equipment
- Construction equipment
- GEM or similar vehicles not designed for highway use
If the vehicle you want to rent out has not been ruled out yet, congratulations! You may be able to use your vehicle to earn cash on Turo, if your automobile is not registered in New York and meets the following requirements.
- Legally registered in the United States (except New York)
- No more than 12 years old
- Fewer than 130,000 miles
- Clean (e.g., not a “branded” or “salvage”) title
- Never been declared a total loss
- Fair market value of up to $150,000 USD (also accept the Tesla S and the Tesla X)
Vehicle owners hoping to rent out a “specialty” or “classic” car may be looking at the age restriction with scorn. Fret not! Turo permits this type of high-quality ride to be listed on the platform if the automobile matches the conditions listed below.
- In the US and Canada, specialty cars must be older than model year 1990
- Market value of up to $85,000 in the US and $75,000 in Canada
- Must be in excellent condition (both mechanical and physical)
- Have all seat belts in safe, working condition
Bear in mind, any specialty car is subject to additional review. There are two other categories your vehicle may fall under if it matches the requirements we mentioned above. Dubbed the Deluxe and Super Deluxe, these vehicles have a fair market value of $55,000 to $85,000 CA. If your automobile fits into this category, a special tag will be added to your listing. In addition to the tag, you priautomatically get the following additional perks for renting out your high-end ride.
- Extra security checks
- More strenuous renter requirements
- Mandatory security deposit from renters
If you choose to list on Turo but use your own personal insurance plan instead of the liability offered by the company, the process outlined above will not be enforced. Nevertheless, everyone must mind the rules set in place in regards to how a vehicle is listed. Here is an in-depth look at the listing requirements.
- Car’s license plate number
- Car’s make, model, and year
- At least one photo of your car.
- We strongly recommend at least one picture showing the exterior of the car and one picture showing the interior. More pictures will help draw interest to your listing and please be sure to only upload pictures of your car.
- A description of your car.
- We recommend including:
- An explanation why guests should choose your vehicle
- Any special features (sunroof, music system, heated seats, etc.)
- List requirements, such as the need to refill with premium fuel
- We recommend including:
How Much Money Can I Make With Turo?
Based on our research, we have concluded that the average car owner makes about $540 per month renting their car out on Turo. This estimate varies heavily across the board due to a wide variety of possible listing combinations. For example, the most obvious factors that determine how much you are able to make is your location and vehicle specs, along with how often a vehicle is rented out.
Let’s take a closer look at how Turo determines the amount of money automobile owners earn from a rental.[su_note note_color=”#ffbf40″]
According to Turo “Turo hosts typically receive 75%* of the trip price, delivery fees, and additional mileage charges. Earnings range from 90% to 65% depending on the protection plan selected.” So if you charge $40 a day and receive 75% (which is default with Standard protection plan), you would receive $30. If you rent your car 15 days a month, that’s $450 per month.”[/su_note]
Of course, these results will be very different for automobile owners that rent out a Deluxe or Super Deluxe car. This is because owners can charge more per rental and those in the market for a high-end rental car are willing to fork out the cash to drive it.
There are other ways for car owners to increase their profits even if they do not have a vehicle that qualifies for the deluxe status. For more information, check out Turo’s tips to maximize your earnings. They provide valuable tidbits on how to maximize your earning potential, such as the tips listed below.
- Use the Automatic Pricing Feature
- Advertise your Turo Listing to Friends and Family
- Suggest Delivering to Renter’s House
- Offer Equipment Related to Renter’s Use
Although this sounds fine and dandy, the real proof comes from someone who is currently renting out their vehicle on the Turo platform. We found a vehicle owner who bought a car solely to make cash on Turo. Thus far, this Redditor has successfully made about $300-$400 on average each month. In profits.
That’s right. After paying off the acquired car note, car insurance, and maintenance, this car owner racked in a decent profit.
Of course, depreciation must be taken into consideration. Every day that passes a vehicle loses its value. Having said that, if you are able to find a way to make your automobile essentially pay for itself over time, why not do it?
What if Something Happens to My Car?
Car owners may be delighted to know that Turo offers protection plans. Each of these programs are available in different levels, however, all of them provide up to $1,000,000 in liability protection. So if something does happen to your vehicle, more than likely you should be covered.
As for the smaller issues, such as someone leaving a mess in your car, Turo will cover the cost of cleaning. The amount Turo will provide to cover the clean up is based on a pre-set amount that can be found here. Major $150 cleanups are categorized as anything that must be steam cleaned to remove. Smaller issues that are not covered are anything that can be wiped off with a bit of cleaner.
The maximum amount Turo will cover for cleaning is $250. However, if you do not see the issue in time, it can be bad news. We have read horror stories where car owners did not notice damage until several days after the rental was returned. If you do not report damage immediately, you will probably be denied coverage.
We strongly advise you to read through the protection plans page to get a better idea of what to anticipate.
Is Renting my Car on Turo Worth it?
If you are able to make a profit from renting out your vehicle and everything goes according to plan, then yes it is 100% worth it. If you do not use your vehicle often, this is a fantastic way to earn passive cash.
Bear in mind, the expense of owning a vehicle goes beyond the price of a car payment. Car owners also pay annual taxes, insurance, and maintenance fees. Furthermore, if you are renting your vehicle on Turo, you are required to report your earnings at tax time using a 1099 form.
Of course, if you are making enough money to cover all of these expenses, this might be the perfect way to get your vehicle to pay for itself.
We would love to hear about your Turo experiences in the comments below!