Student CarShare leverages its partnership with Discount Car and Truck Rentals through its fleet buying power, operations infrastructure and ability to cross promote.
The major car rental companies now control the majority of the car-sharing market and are beginning to realize the synergies with fleet and operations.
Two smaller, independent car rental companies are following suit — but from different business models.
Fleeting Up Fast
Michael Lende, founder and CEO of Student CarShare, saw a need for a car-sharing service that catered to an underserved yet obvious market — renters ages 18 to 25 on college campuses not served by the major car-sharing players.
Lende, who helped establish Zipcar in Toronto, partnered with Discount Car and Truck Rentals, one of the largest independent car rental providers in Canada. In September, Lende launched the car-sharing service at 16 campuses in and around the province of Ontario, Canada. Though they operate as independent companies, Discount provides the fleet of Kia vehicles and in return receives a portion of Student CarShare’s overall profits.
Lende explains that the biggest challenge for a Car Share Operator (CSO) is building a fleet. The partnership with Discount not only eliminated this cost, but it also allowed Student CarShare to launch in 16 markets at the same time. “[The Discount partnership] allowed me to set up shop without the major overhead that most CSOs have to worry about,” Lende says. “I can add cars quickly, without pain points.”
The companies are complementary in many other ways. While Student CarShare’s demand centers on the school year months of September to May, Discount’s highest demand season is the summer. Lende says it’s too early to report on fleet sharing, but he anticipates the opportunity to cascade cars to the Discount fleet in the spring for the busy summer rental season. Non-students use the service as well, and having “Student” in the name serves as a marketing angle for cheap rates, Lende says.
To be able to cater to younger drivers, Student CarShare leveraged Discount’s longstanding insurer relationships. In addition, Student CarShare requires that members have a valid credit card and no more than one minor moving violation in the last three years. Lende says 86% of applicants are approved.
As well, fleet transport, maintenance and car sales are handled through Discount, and Student CarShare is able to promote at Discount locations. “When someone sees their brand underneath our brand, ‘Student CarShare powered by Discount,’ there’s a credibility that goes along with that,” Lende says.