“Let’s take a personal watercraft. I would say over 50 percent of the [EagleRider] rentals that went out sucked rocks up into the shaft of the jet, ruined the shaft and potentially disabled the vehicle for another customer. We had to replace the jets in a lot of them,” MacIntyre said. “The problem is with a personal watercraft, they are not checking or replacing. You have to check it in, literally, a pool. Among owners, 99 percent are going to be people who have them in trailers in their yard and they are just trying to pay them off. With that comes maintenance.”
The biggest pitfalls may be in getting the vehicles to and from riding areas. “Most people drive maybe 15 minutes to an hour [to pick up a rental]. What we are seeing is that they are renting boats or ATVs on their way to a recreational area,” Gardner said. “The availability of existing rentals is very limited. They are generally in major tourist destinations so people don’t mind picking them up on the way.”
That, MacIntyre noted, can lead to additional challenges. Often, people aren’t trained to drive while pulling trailers. “People renting don’t know how to back up. If there’s a third party - now you have a trailer that is being towed that is not insured. The liability is enormous,” he said. “The amount of injuries and accidents that occur because of people who don’t have experience pulling a trailer -- there is a huge, huge, huge liability. You don’t even get it in the water.”
Fun2Rent offers safety courses by Fresh Air for boating, snowmobiles and ATVs and provides a screening process for prospective renters. That was key to getting insurance.
“We require all renters to take a safety quiz on the sport they are renting. We follow up with a phone interview to make sure they are qualified to operate the vehicle,” Gardner said. “They take a quiz on the website and we can see the results of the quiz on our website. We follow up with a phone call if we think they didn’t do too well.”
The courses are free to qualify for rentals, and Fun2Rent offers a $5 off promotional code for riders who want to use the training to get state-certified.
Under Fun2Rent contracts, renters must be at least 21 years old and riders must be at least 18. They must provide valid driver’s license information, a credit card and pass the safety exam. The company offers an option to give a waiver for multiple riders. And contracts specify what is allowed and what isn’t.
“It’s very similar to somebody renting a boat and then consuming alcohol. We have these [prohibitions] in our policies and terms of service,” Gardner said. “We can’t predict every scenario that a renter will do. But they are completely responsible during the time of the rental. The insurance policy would not be effective if they don’t follow the terms and conditions.”
Online training may not be enough to protect the company, vehicle owners or renters, MacIntyre said. “Those statistics from doing thousands and thousands of rentals won’t change. They will only get worse. The orientation with a private owner will never be the same. We have EagleRider University to train people to ride it before they rent. We spend weeks of training on orientation,” he said.
The same issues are on the insurance industry’s radar, but might be overcome. “There are ways to mitigate exposure and protect yourself,” May said. “If you are doing the right things, there are companies that would be comfortable getting into this market.”
DEALER 'TRY BEFORE YOU BUY' PROGRAMS?
If his business catches on, Gardner said he’d like to work with dealers to facilitate try-before-you-buy rentals of their used vehicles to potential customers.
“We would facilitate boat dealer, personal watercraft and ATV rentals to a potential customer to make a sale of a used vehicle,” Gardner said. “If they like it, the rental goes to the purchase price. If they don’t, it goes to the dealer.”
Prokup, who served as director of Emerging Market Communications for the MIC’s Discover Today’s Motorcycling and is a Motorcycle Safety Foundation RiderCoach, sees that and other possible opportunities for the dealer community.
“There are a few scenarios where more affordable P2P rentals could augment dealer sales. For one thing, after renting a few times, new(er) users of powersports vehicles may discover that they really want to own one themselves,” Prokup said. “P2P rentals could take the place of test drives, which many dealers aren't able to offer, though test drives are often the ultimate determinant in the purchase decision. I can see customers seeking out a particular vehicle they're interested in so they can spend a day or more trying it out.”
And, she noted, “it's possible that some people will purchase a powersports vehicle already planning to participate as owners in a P2P rental program, because renting it out will help defray the cost of ownership.”
Sharing the Ride: A History
There seems to be plenty of precedent for a powersports P2P culture.
It’s not surprising that the San Francisco Bay area is fertile ground for P2P rentals. The proximity to Silicon Valley and venture capital blended with the bean sprout-and-Birkenstock culture is a perfect environment for what’s known as “collaborative consumption.” In an Inc. magazine article last November profiling the “Seven Startups Changing Peer-To-Peer Commerce,” five are in San Francisco.
P2P car services like Wheelz, which launched last September on the campuses of Stanford University and the University of Cailfornia-Berkeley, and San Francisco-based Getaround, which launched in May 2011, help the transportation-challenged get rental rides when they need them. Though the first known P2P car rental company in the United States market, RelayRides, started in Boston, it moved to San Francisco early last year.
The vehicle concept seems to have originated in Australia in 2008, when Drive My Car Rentals launched. But similar services have already caught on in Germany, France, the Netherlands, the United Kingdom, Spain and Sweden.
Though relatively new in the U.S., fleet-based car-sharing services like Zipcar and Brooklyn-based Carpingo are springing up almost daily. There’s even P2P bicycle rental site Spinlister.com, which launched April 1 and so far offers bicycle rentals in San Francisco and New York City. -- Holly J. Wagner