Against this background, Shenzhou Rent-a-Car, which has the largest service network, the largest network and the largest fleet in China, launched ICAR, a time-sharing rental platform in Beijing, Shanghai and Guangzhou in March this year. It delighted users with its low-cost luxury car rental, but also raised doubts.
Consumers and operators have yet to resolve their pain points, and the profit of time-sharing leasing is far from being realized
Since the emergence of the first time-sharing leasing company in 2011, there has been no truly profitable enterprises in the time-sharing leasing industry. Some Internet-backed startups claim that local markets are even or profitable only on the premise of small market scale.
From the perspective of users, timeshare leasing, as a new choice for urban travel, should have advantages in terms of price and flexibility compared with taxis and private cars and other travel tools. However, most timeshare leasing platforms do not meet users’ expectations.
On the one hand, it did not meet the expectation of user flexibility. Although most of the time sharing rental platform constantly expand the site, but the layout of vehicles more than one thousand players are numbered, and even if the future site, more can’t let each user has a site downstairs, even if each user has a site downstairs, later all can’t avoid similar to the high cost of Shared cycling as frequently scheduling. From this point of view, timeshare rental cars are far less convenient than taxis.
Secondly, the expectation of price is not satisfied. Taking Beijing taxi as an example, it costs 34 YUAN to travel within 10 kilometers in 30 minutes, while for tuge and Hiche, it costs 34 yuan and 33 yuan to travel within 10 kilometers in 30 minutes. After comparing the prices of other time-sharing rental companies in the market, it can be found after several rounds of comparison that, Most timeshare rental products on the market are not much cheaper than taxis.
From an operator’s point of view, it’s not an easy business. First, time-sharing leasing is an asset-heavy mode, which requires hard expenditure in aspects such as network construction, charging network, vehicles, service and maintenance system, with high initial investment. Second, time-sharing leasing income is too single. Although China has government subsidies for network construction, car purchase and operation, the main revenue of time-sharing leasing still comes from vehicle operation. Affected by factors such as scale, time-sharing leasing is still difficult to achieve profitability. Third, the car environment is dirty and messy, the delay of consumer driving violation notice and other problems, bring a lot of problems to the management.
In general, before the pain points of users and operators are solved, it is difficult for time-sharing leasing model to achieve profits in a short time, and it is impossible to enter with traditional cars. However, The entry of Shenzhou Car Rental seems to be breaking the deadlock.
Shenzhou time-sharing leasing scenery behind the infinite, also attracted a lot of controversy
Not long ago, China Rent-a-Car announced that by the end of the first three quarters of 2017, the size of the car rental fleet reached 83,576 vehicles, and the utilization rate of the fleet reached 67.7%. On the other hand, the idle rate of vehicles held by China Rent-a-car exceeded 30%, which means that there will be nearly 30,000 cars in idle state every day. According to the official words: “When China Car Rental has achieved overall profitability, it takes out idle resources to lay out the time-sharing leasing model, which is a cost-free business model. It can earn as much as it can, and there is no loss problem”. It can be seen that shenzhou time-sharing leasing can break the profit dilemma of the industry by using idle resources.
Earlier, Lu Zhengyao said to the media: “The time-sharing leasing industry should come to an end with the launch of our low-cost product. At least the rules of the game have changed. Everyone should follow my rules and play the game if they can afford it, and don’t play if they can’t.” The confidence of Lu Zhengyao comes from the fact that his products really have advantages. By using idle resources, Shenzhou time-sharing rental products start at 0 yuan +0.19 yuan/minute +0.99 yuan/km, which is lower than tuge, Hiche, GoFun and other products in the market.
Less than four months after the launch of Timeshare Rental, shenzhou has rapidly covered more than 55 cities in China, relying on the network of Shenzhou and the price advantage of its own products. Therefore, from the current momentum, shenzhou timeshare leasing is full of glory, but at the same time, Shenzhou timeshare leasing is also accompanied by some disputes.
First, would it be better to reduce more than 30% of idle resources? The profitability of Shenzhou Car Rental under such a high idle rate mainly comes from its various profit channels. On the one hand, it reduces the vehicle cost through large-scale car purchase and mature second-hand car market, and on the other hand, it obtains additional income through auto finance and auto insurance. May be because of the profit pressure, on Jan. 15 this year, the Shanghai securities news entitled “car rental companies suspected of illegal selling insurance protects inspect bureau to examine investigations revealed” shady “” reports, has revealed China auto rental in the absence of the qualifications of management insurance business cases, directly to the lessee collection” premium “which has been suspected of illegal business insurance business. In this case, the industry believes that Shenzhou car rental initiative to reduce the idle rate of vehicles may be better.
Second, time-sharing leasing with traditional automobile layout goes against the development trend of the industry. The time-sharing leasing mode of traditional cars has existed for a long time. This mode has not become the mainstream leasing mode today, because compared with traditional cars, new energy vehicles are more suitable for time-sharing leasing. On the one hand, compared with the luxury car + fuel + parking fees and new energy + electricity + parking fees, new energy vehicles cost-effective, coupled with the new energy car has always had policy subsidies, from this point of view alone, new energy vehicles than traditional gasoline cars in the price has an advantage. With the maturity of supporting facilities such as charging piles and parking lots in the future, the gap will only grow larger. Second, the introduction of time-sharing leasing with traditional gasoline vehicles also violates the expectation of city managers to build green urban travel.
Thirdly, from the perspective of operation logic, time-sharing leasing in Shenzhou will affect the short-term leasing business in Shenzhou. Traditional car rental and time-sharing leasing are two different models. Firstly, time-sharing leasing business and its main short-term leasing business trade off each other. Once it goes on for a long time, its traditional car rental business will be affected. Secondly, Shenzhou Car Rental relies on the store-based management mode, with dozens of people managing hundreds of vehicles. After the time-sharing leasing mode is added, vehicles will flow more frequently between stores, which is bound to affect the previous management mode.
Fourth, from the point of view of time-sharing leasing business, Shenzhou Car rental layout time-sharing leasing seems to be saving itself. At present, after a round of land enclosure, Shenzhou Car Rental has become the largest car rental company with the fleet size in China, and the price paid for the title is very large, as high as 30% of the idle rate of resources is an obstacle to further profit of Shenzhou Car Rental. According to the 2016 and 2017 financial reports of Shenzhou Rent-a-Car, 2016 revenue of 6.454 billion yuan, profit of 1.46 billion yuan, 2017 7.717 billion yuan, profit of 881 million yuan, it can be seen that although the overall revenue of Shenzhou Rent-a-car went up, but the overall profit declined. Compared with the time-sharing leasing model, traditional car rental companies tend to engage in long-term and short-term leasing business. Shenzhou Car Rental can break the normal pattern and announce to enter the time-sharing leasing industry, which seems to be saving itself.
Hesitant Shenzhou car rental may miss the layout of new energy vehicles the best time
Tuge, a traditional time-sharing rental car company, has gradually joined the new energy vehicles on the basis of traditional cars, while Shenzhou Car Rental, as the leader of China’s car rental industry, is hesitant in the new energy vehicle market. Although there are many difficulties in the layout of timeshare leasing with new energy vehicles, such as short operating mileage and insufficient charging piles, for Shenzhou timeshare leasing, if it does not choose the layout of timeshare leasing with new energy vehicles combined with technology, it may miss the best time for the layout of new energy vehicles.
First, the distribution of network, vehicles, license plates, urban roads and other resources required by new energy vehicles will cost less under the implementation of favorable policies such as “double points”. For example, in the construction of new energy infrastructure, “difficult site, difficult capacity expansion, difficult coordination, difficult management”, these four problems can be quickly solved with the help of favorable policies.
Second, under the impetus of the “timetable of banning fuel vehicles”, the development tone of new energy vehicles has been determined, and the future license network resources have the world. The late Shenzhou car rental is likely to miss the best time to obtain new energy licenses and outlets. Up to now, Go Green Dog has built more than 130 smart sites of car piles in China, while The traditional automobile group Shougu has obtained 332,454 parking Spaces and 3,520 charging piles through GoFun time-sharing leasing. These resources will undoubtedly help these car travel platforms take the lead.
From this point of view, Shenzhou Car Rental can gain great advantages in the time-sharing leasing industry by entering the local time-sharing leasing field and utilizing its idle rental resources. But to become the ultimate winner of this industry, Shenzhou car rental still needs to keep up with the new trends of the industry.
Article/Liu Kuang public account, ID: Liukuang110