Insurers see value in digital vintage car-sharing
(Bloomberg) -- Vintage cars are alluring. They represent the simplicity, or craftsmanship, or louche sleaziness of a bygone era. They are also—and I say this as the proud owner of four old vehicles—fussy, dangerous, and excruciatingly unreliable. Not everyone enjoys this kind of constant crapshoot in their daily drive.
Fortunately, a trio of “sharing economy” apps allow occasional access to well-maintained classics. DriveShare, Turo Inc., and Vinty Inc. all function like Airbnb, but each has a unique position. Owners list their vehicles, upload information and images, set a rental price, and provide guidelines on things such as mileage, security deposit, and delivery instructions. Users need to meet a minimum age requirement: For Turo and Vinty it’s 21 with supplemental insurance, 25 without; for DriveShare it’s 30. They must upload their driver’s license, and in some cases a Social Security number, then await security and safety screening and verification, which can take as long as 72 hours. Once approved, users can scroll, click, and finalize the details.
DriveShare is a subsidiary of Michigan classic-car insurance company Hagerty, which represents hundreds of thousands of vintage vehicle owners, most of whom use their cars only occasionally. “Many classic cars spend a lot of time in garages when they could be earning their owner some revenue,” says Peter Zawadzki, the app’s founder. “A lot of people want to drive a classic, particularly for special occasions, but don’t have the resources or time to own, maintain, and store one themselves.” This creates a win-win, especially because old cars like to be exercised regularly. It keeps their vital fluids circulating, their batteries charged, and their components from drying out.
Turo is the giant of the trio, a company founded a decade ago by a Harvard Business School student that now operates in 5,500 cities with some 350,000 cars. Liberty Mutual owns a stake. Turo acts mainly as a peer-to-peer option to Hertz Corp. or Alamo Rent a Car, renting newer cars to business travelers or vacationers, but vintage vehicle offerings give it differentiation and cachet. “It’s not the majority of our business, but it’s certainly a part that’s very aspirational,” says Chief Executive Officer Andre Haddad.
Vinty is the small indie. Where the other two apps have a national profile, the backing of a national insurance company, and a large vehicle pool, Vinty has 1,250 classics that are mainly clustered in Southern California, where the company is headquartered. This is strategic. Although individual customers are welcome, the company and its “hosts” derive most of their revenue renting vehicles for film, TV, and commercial shoots, as well as special occasions such as weddings or corporate events.
“We tell owners, either you can let someone else drive, or you can just bring the car for an event and have customers take photos with them and have them act as a prop,” says company founder Pierre Lapointe. This ability to act as on-site steward, and not have the car driven much, is attractive to many fussy old-car owners, for whom their vehicles are their babies. (DriveShare allows movie/event rentals as well.)
Test-Driving DriveShare and Turo
So what’s it like using these apps? As with all things involving old cars, the results were unpredictable.
My first rental, a 1990 Jaguar XJ-S from DriveShare, was flawless. For $200 a day for a three-day rental, the owner met me curbside at LAX in the white, V-12-powered coupe—a car I’ve pined for previously. We retreated to a nearby parking lot to go through the vehicle and its quirks and take some “before” photos, then I was off.
Despite a reputation for abysmal reliability, the Jag was steadfast. The car started up every time, the AC blew cold, and the suspension absorbed impacts, physical and emotional, on L.A.’s mean surface streets. The drive also reinvigorated my search for an XJ-S of my own. Not surprisingly, this is one of Hagerty’s noted use cases: potential buyers taking a vintage car out for an extended test-drive prior to considering purchase.
I didn’t have time to try out Vinty, but I did get to experience Turo, renting a bright orange 1969 Ford Bronco. Delivery wasn’t available, so I picked it up at a lot adjacent to the San Diego airport. There, I met an attendant from Luso, a company that owns hundreds of cars and rents them out via the Turo app. I received no instruction about the Bronco. Having paid my $249 a day for five days (with 350 miles included), I was just given the keys and set loose.
The Bronco was to be the steed for an adventure to the San Jacinto Mountains with my friend Lance. Since he’d never driven an old car, I gave him first dibs. Rainstorms had blanketed the area and seemed to have affected an electrical connection in the vehicle, because just after we set out, its horn became almost comically stuck, even when parked. Unable to locate the horn’s power wire, the situation became untenable. I called the owner and drove the blaring Ford to a nearby shop.
Since the shop was able to fix the short by the next morning, Lance and I decided to stick with the Bronco (the owner graciously offered a new Porsche convertible, but that seemed like cheating).
The truck only broke down three more times.
On the highway at 70 mph, the transfer case popped out of gear, cutting off power and forcing us to coast into the breakdown lane. Shortly later, after a fill-up, the Bronco conked out in a fast-food drive-thru and refused to start for 30 minutes. Then, after shepherding us around the mountains seamlessly for a couple of days, on the morning of our departure, it again refused to start. Thinking we might coast downhill to a nearby service station, we pushed the Bronco through a neighbor’s yard—using a pry bar to move small boulders. Once it was level, it started. We beelined back to San Diego, and when I returned the Bronco, the owner was present. I told him about the mishaps. “Were you parked on a hill today?” he asked. I nodded. “Yeah. It does that sometimes.” Details like this, I said, could best be provided in advance.
Still, the Bronco was undeniably fun, an ideal attention grabber for a weekend. And the anecdotes—indelible, but never life-threatening—are already aging into legend. Old cars teach you to enjoy the lunacy they are always moments away from engendering.
For the less adventurous, each app has protocols for breakdowns. DriveShare provides roadside assistance through Hagerty’s extant program and will refund you for any rental that can’t be completed. Turo would have towed the truck away—through Liberty Mutual’s roadside service—and found another local vehicle or reimbursed our Uber to the closest available vehicle (though it wouldn’t have been an old Bronco). Vinty, as a smaller player, is more hands-off, encouraging the two parties to come up with a rescue plan prior to the rental.
But if you’re thinking of entrusting your precious baby to random strangers online, unless there is proven malice or a wreck, any mechanical issues resulting from a rental end up being the responsibility of the car’s owner.
“We like to think of it this way,” says Zawadzki. “Revenue from DriveShare can help car owners offset inevitable maintenance and ownership expenses related with collector cars.”
I’d been considering renting out one or more of my vintage vehicles through these services, but having experienced the range of possible outcomes—and my vehicles’ myriad quirks—I was reconsidering the cost-benefit analysis. Like Airbnb-ing my beloved but funky lake house, it seemed more invasive, more of a headache than it was worth, a better deal for the guest than the host.
Recently classic-car obsessed, but less experienced (and less jaded), Lance had a slightly different take, one more aligned with the apps’ mission. “I would definitely rent another vintage car—with you,” he said. “But I don’t really think I’d want one as my daily driver.”