
Customers say Getaround has been slow to pay repair bills - JumpCrisscross
https://www.bloomberg.com/news/articles/2020-04-03/they-rented-their-cars-out-online-then-things-fell-apart
======
bsg75
> She purchased a Prius last year specifically to rent on Getaround, using the
> money to cover both its monthly costs and those of her primary vehicle.

That seems like a risky move, and an attempt to compete in the general car
rental business without the protections of a well established business
(compared to a startup).

While it may make sense for a car owner to assume some risk to recoup costs on
a vehicle they already own, buying one for the sole purpose of renting it out
seems less sensible.

~~~
refurb
It sounds like it wasn't some sort of investment decision, but a setup that
worked for this person.

Say you live in a major city and need a car, but it would sit there parked 80%
of the time. You can't justify the cost.

But if you could rent it out that 80% of the time, you end up in a situation
where you have a car to use, but it's either costing you nothing or making you
a little bit of money.

~~~
caseysoftware
But that wasn't this situation:

> _She purchased a Prius last year specifically to rent on Getaround, using
> the money to cover both its monthly costs and those of her primary vehicle._

She bought an investment vehicle (no pun intended) that worked for a while and
then crashed (still no pun intended). She overextended herself and can't
handle the downside.. this feels like a bit game of musical chairs and she was
caught without a seat. :|

~~~
refurb
I misread that statement the first time. I didn’t realize this was in addition
to her primary vehicle.

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ericabiz
This pandemic is really shining light on many flimsy and questionable business
models. In good times, it looks great on paper to own a business with no
inventory and whose sole purpose is to be a marketing middleman between people
offering a service and those in need of a service.

But in bad times, income dries up—in this case, extremely quickly—and the
flaws of that business model are exposed.

Airbnb, coworking spaces, Getaround, and home services companies are just a
few examples of this model. Bird/Lime also have this issue and will likely
collapse as well—both have laid off most or all of their staff (Bird in
particular handled it poorly.)

~~~
temp20160423
I don't follow this logic.

Bird/lime own their inventory.

Airbnb is better off than the hotel chains IMO. The hotel chains have to keep
paying their staff and rent while revenue drops, but airbnb just sees the
revenue drop.

It exposes the people who bought properties to list on airbnb on aggressive
margins or like the example in the article of someone buying a car just to put
on the platform. I wonder how much rental prices will be affected when the
properties that were bought to use for airbnb are brought back to the long-
term rental market.

~~~
gamblor956
AirBnB will be worse off, because post COVID19, people will trust hotels more
than random strangers' houses. You _know_ the hotel will be cleaned. You can't
say the same of an AirBnB.

And it's very likely that AirBnB restrictions will increase post-COVID19 to
eliminate a lot of the apartment units that were (illegally) converted to
AirBnB units, and that enforcement of existing AirBnB restrictions in cities
like NY and LA will increase dramatically, both for safety reasons and to
protect the hotel companies that actually employ workers, pay hotel taxes, and
contribute to the local economy.

~~~
colmvp
I can't speak for every city, but where I live, a lot of Airbnber's are
hurting for the sudden drop in revenue. Hotels might get bailouts or credits
from the government but short term rental companies will get nothing and be
hard pressed to find the resources to continue paying their mortgages. We're
already seeing condos that were rented out as Airbnb's pop up on the real
estate market.

~~~
gamblor956
That is a good thing. Those condos should never have been converted to
unregistered hotel rooms, and I'm sure the other people living in those
developments will be glad that the parade of strangers will no longer be
invading their buildings.

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sixQuarks
After I bought an electric car, I kept my other car around just in case. I
figured I'd rent it out on Turo since I wasn't concerned about maintaining the
condition of the vehicle (it's a 6 year old Nissan).

Even though I wasn't concerned about my car being mishandled by renters, I
couldn't believe the condition some renters would return it. After this
experience, I would NEVER rent out a nice car through these services. If
people treat your car like shit, imagine what they do to big rental car
company's vehicles.

~~~
erdos4d
Big rental car companies can keep coming after you for the damages though. A
lot of people don't have the same fear of some startup making the same effort
for a vehicle that isn't theirs in the first place.

~~~
_bxg1
It's a common theme with many of these "sharing economy"/"gig economy"
companies:

"We're like X but without all the stodgy process and procedure!"

[a few years pass]

"Turns out all that extra stuff was there for a reason and now we're going to
either punt on it and screw over our customers and/or contractors, or monkey-
patch it onto our business that wasn't built with it in mind."

------
_bxg1
One might say they pay when they... get around to it.

I'm sorry, I couldn't resist.

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neonate
[https://archive.md/tHwp4](https://archive.md/tHwp4)

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amiga_500
The rentier economy, aided by automated systems online, is now proving to be a
total failure.

The downside risks versus the short-term gains are too asymmetric.

Car rental - damage is very expensive, margins are tiny House rental - long
term loans, short term lets that have proved very volatile in the pandemic.
Office space rental - wework, again long term borrowing, short term rental.

The idea that we can endlessly slice and dice risk to get a "free" gain is
rotting society.

Learn a skill. Create value. If everyone does this we live in a better
society. We cannot all live off each other. Someone has to create value.

~~~
khc
but they are creating liquidity in the car rental market! /s

~~~
gruez
But they are, for the buyer. More sellers = more liquidity. It just also turns
out they (the sellers) are making money by picking up pennies in front of a
steamroller.

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paul7986
Umm the economic world is falling apart unfortunately! Thus, put any startup
or company's name here in which their business deals with ppl congregating or
where germs are spread and the story is the same.

There should be a list of what businesses will remain strong and become
stronger so entrepreneurs can quickly create new businesses ..anything food
related, medical, online sales & delivery, anything internet/communication
infrastructure related, govt services, COVID prevention, COVID research... are
some I can think of

~~~
AnthonyMouse
What this is most affecting is the service industry. If your company makes a
product that can be put in a box and shipped to the customer's door, people
can still buy it. Maybe even more people buy it because they're working from
home but still getting paid or just got a $1200 check or both, and they're not
about to spend that money on restaurants or theater tickets right now.

That may even carry forward somewhat. You have someone who doesn't have a
washing machine, well the laundromat is closed or they don't want to go there
and they just got $1200, plus there are lower interest rates and cheaper
financing, so now there's a truck delivering a washing machine and they're
never going to go to the laundromat again. Even if it eventually breaks
they'll buy another one because by then it's the status quo.

It may be a good time to get into the business of making stuff.

~~~
jcranmer
> well the laundromat is closed

For what it's worth, in every emergency shutdown order I've seen, laundromats
have been classified as "essential businesses."

