In more than half a dozen states, legacy corporations are yet again trying to use the legislative process to limit startups. But it's Americans across the country who will end up losing.
The latest spat is about who can and can't rent their vehicle to make extra money. Traditional car rental companies like Enterprise, Hertz and Avis want to fend off competition from internet-enabled platforms like Turo that allow anyone to rent their car. If these politically connected car rental behemoths get their way, American consumers will be left with fewer choices and less money in their pockets.
Turo is part of the peer-to-peer car-sharing industry. This industry is possible because the internet has created an online marketplace to connect vehicle owners with drivers looking to temporarily rent their car of choice from their location of choice.
The benefits are clear for vehicle owners: The average Turo user rents their car 10 days a month and earns over $500, enough to cover monthly car payments and offset maintenance and insurance costs. Peer-to-peer car sharing also creates an incentive to use vehicles more efficiently by providing new technology and financing models that make it easy for owners to rent their vehicle. In fact, studies show that each car-sharing vehicle replaces four to eight cars on the road, reducing emissions and making our future greener.
It’s no surprise that rental car companies see the car-sharing model as a threat. Collectively, Enterprise, Hertz and Avis own more than half of the market, have fleets with hundreds of thousands of vehicles, and earn tens of billions in revenue every year. Their size and reach don’t entitle them to stifle innovation and competition, but they’re using the legislative and regulatory process to do just that.
Entrenched car rental companies want the average person who rents out their vehicle to be treated like they're a massive rental company. They want the “tech-savvy” aunt who rents her Mazda Miata to be subject to the same sales taxes and vehicle maintenance rules as a company with a global fleet of cars.
Unfortunately, these entrenched companies are succeeding. The latest lobbying effort is happening in Utah, where they’re pushing for legislation that will slow or stop Turo's ability to serve Utah citizens. Onerous laws have already proved detrimental in places like New York where, in 2013, Turo had to shut down its platform because of regulations that made it nearly impossible for car owners to rent their cars. Peer-to-peer car-sharing and traditional car rental companies face different economic realities, and opponents' calls for a "fair" system are really a backdoor way of eliminating this option for Americans. We need modernized laws that accommodate internet-enabled competition, not laws that stifle it.
This is America. Massive multinational corporations shouldn’t be able to block individual citizens from renting their personal property. It’s their car, and they should have the freedom to rent it out.
The concern that car sharing will eliminate traditional car rentals is unfounded. Peer-to-peer car sharing is mostly neighbor-to-neighbor renting. It is individuals who own and care about their personal vehicles, and people who are thankful for the convenience and flexibility. The only thing that needs protecting is consumer choice.
We must prioritize consumers and competition over entrenched corporate interests. The internet industry will continue fighting for innovation and opportunity despite the steep opposition from companies trying to hold the market. We stand by car-sharing platforms like Turo and the service they provide for Americans looking for a different car rental experience.