Twin Cities Airport leads the way for peer-to-peer car-sharing service

Earlier this month, Louis Lidji pointed his gleaming latest-generation Hyundai Sonata to a marked spot deep in the maze of the red parking ramp at Minneapolis-St. Paul International Airport.

Lidji parked his car, took some photos of his interior and exterior with his phone, locked the doors and returned home to Eagan. A few hours later, someone he didn’t know arrived at the MSP, picked up the Sonata after Lidji, unlocked it remotely using his phone, and drove it out of the parking lot, like n any other car rental.

But unlike the usual exercise with Hertz, Budget, or Enterprise, this is a new way to rent a car through a service called Turo that MSP officials are embracing – at least for now.

Often referred to as the “Car Rental Airbnb,” Turo is a peer-to-peer car sharing service that connects personal vehicle owners with customers through its app or website. San Francisco-based Turo and other carsharing services such as Getaround, Maven, and HyreCar are part of a sharing economy that has exploded over the past two decades.

Airports seem a natural fit for this emerging service, but many airports across the country have been slow, if not outright resistant, to welcome Turo.

Lidji, a home-based mortgage banker, figured he could make money using the Turo platform to rent his 2020 Sonata, which would otherwise have remained in his garage.

“It was really great,” said Lidji. “The car won’t get used to, I don’t need it to get to work. Financially, [Turo rentals] I’ve pretty much paid for the car since I started. “

Founded in 2010, Turo is now available in 5,500 cities across the United States, Canada and the United Kingdom, with a “community” of 14 million users and hosts. Airports serve as popular rental portals, but aren’t the only place vehicle transfers take place.

MSP officials say they knew Turo had been operating quietly at the airport since 2017 on an ad hoc basis, but without paying any concession or access fees like those charged by traditional car rental companies.

At the time, an attorney for the Metropolitan Airports Commission (MAC), which operates MSP, sent a letter to Turo chief executive Andre Haddad, calling on the company to “cease and desist” from operations at the time. unless it pays the appropriate fees and submits reports regarding its operations. The missive threatened legal action if Turo failed to comply.

In the spring of 2020, the commission asked MAC staff to investigate Turo’s presence at the MSP, and an audit began last August. MAC officials found that an average of 32 Turo vehicles were available for rental at MSP each day, with 106 vehicle owners advertising their rental services from the airport. Prices ranged from $ 30 to $ 499 per day, with vehicles delivered on-site or through in-person pickup.

While some airport operators like MAC have made deals with Turo, others have rejected the idea. At Boston Logan Airport and Los Angeles International Airport, the short history of peer-to-peer leasing has included lawsuits from both Turo and airports and resulted in bans from Turo.

Last fall, the MAC formalized the relationship with Turo by launching a one-year pilot program that rents five locations for vehicle pick-up at level 6 of the red ramp at Terminal 1.

Turo also has access to the upper east causeway of Terminal 1 – the same pickup area for Uber and Lyft – for in-person car drop-offs. And Turo must pay 10% of gross receipts as a “lien fee” and submit monthly statements documenting the receipts.

The pilot program will give the MAC a better understanding of how peer-to-peer leasing works, especially if competitors want to set up shop as well.

In a report, MAC officials note that peer-to-peer car rental has been a “disruptor” to the long-standing car rental industry, in the same way that ridesharing companies Uber and Lyft have shaken up the car rental industry. taxis. When the MAC adopted a legal framework for Uber and Lyft in 2016, it was after many months of often moving debates pitting ridesharing drivers against taxi drivers and operators.

Turo’s Haddad said in a statement he was “delighted that MSP officials have taken an innovative step in recognizing the benefits of peer-to-peer car sharing, including meeting consumer demand in Minnesota. Peer-to-peer car sharing not only provides travelers with better options for booking a car, but also gives Minnesotans the ability to find financial freedom by hosting their own vehicle on the platform. “

But carsharing has its detractors. The American Car Rental Association (ACRA), a trade association based in Long Lake, NY, said companies like Turo should comply with federal and state laws governing insurance, liability, recalls, consumer protection. , taxes and operating costs at airports.

“They say ‘We’re different from car rental companies,’” ACRA spokesperson Greg Scott said. “But if you walk like a duck, then you are a duck.”

The deal at MSP comes as the COVID-19 pandemic has shaken the traditional rental car market. Car rental companies have sold thousands of cars following a drop in demand to stay in business. But as vaccinations set in and people began to travel again, the shortage of supplies sent prices skyrocketing.

In addition, a global shortage of microchips has reduced the production of new cars, making it difficult for car rental companies to replenish their supply.

Lidji said he believes the shortage of traditional rental cars has helped drive demand for Turo’s service. And, “with COVID, not knowing when things are going to change is good to have a source of extra money,” he said. He recently bought a convertible Mustang for hire from Turo, which is very popular during Minnesota’s warmer months.

Beyond the extra money, Lidji said he “really enjoys meeting and helping people, that’s a big part of it.” Unsurprisingly, users have given Lidji a five-star rating on the Turo app.

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