Turo has been called “the AirBnB of car rentals” and the peer-to-peer car-sharing marketplace has enjoyed a meteoric rise in the wake of the Covid-19 pandemic, filling the gap in the market left behind by struggling rental companies. But how similar is Turo to AirBnB? And what are the differences?
Turo and AirBnB are both apps that are used for shared economies in the car rentals and short-term accommodation markets, respectively. However, the fees charged by Turo and AirBnB take on different structures, due to Turo’s provision of liability insurance to people listing vehicles on their apps.
Turo’s valuation surpassed $1 billion as far back as 2019 when it was a mere startup company. And today, it has firmly established itself as a market leader, allowing Turo users not only to find affordable rides but to make some money while renting theirs out to other users.
What Is Turo?
Founded under the name “RelayRides” in Boston in 2010, San Francisco-based Turo is a vehicle-sharing marketplace that is available in over 5,500 cities in the United States, Canada, Germany, and the United Kingdom. There are more than 350,000 vehicles registered on the platform, and the app has more than 10 million users.
Users can find a car on the Turo app or website, make bookings on the platform, and pick it up from the owners either at their home, the airport, or a custom location. Positive reviews favor the algorithm, making the top-rated vehicles/owners show up first in searches.
It is a great way to make money – although Turo charges car owners a percentage of the fee (roughly between 25 and 35%), which is calculated according to which insurance option you select. Turo offers up to $1 million in liability insurance, along with 24/7 roadside assistance and support for both renters and car owners.
Listing your car on Turo is free. Renters can set their own ground rules, and Turo will reimburse you for fuel and additional mileage expenses. They will also take earnings from the difference between your set price and what the renter is willing to pay.
Furthermore, if you own multiple vehicles, you can even build your own fleet and rent out multiple cars at once.
What Is AirBnB?
By now, AirBnB has become a household name for most after being founded in San Francisco in 2008 and has become synonymous with shared economies and peer-to-peer marketplaces. As of 2021, AirBnB has over 2.9 million hosts and seven million listings in over 100,000 cities in more than 220 countries and regions worldwide.
Like Turo, AirBnB follows a process for listing and booking apartments, houses, and other short-term accommodation options. Hosts can list their properties on the AirBnB app or website, setting their fees, with the option of requiring a deposit. AirBnB takes a small 3% fee for facilitating the interaction and rewards hosts with high ratings and positive reviews.
There is a range of other options available, such as cleaning fees that allow hosts to customize their guests’ experiences and ensure their home environment remains safe.
As is the case with Turo, some AirBnB hosts will list multiple properties, and the platform is used to manage various properties. However, AirBnB has faced criticism for rising rent prices in parts of the world where this practice has become commonplace.
Is Turo Owned By Airbnb?
While Turo and AirBnB are very similar platforms, albeit for different markets, it’s no surprise that some may think the same people own them, especially considering that both are San Francisco-based companies.
However, Turo is not owned by AirBnB but by the holding company, InterActiveCorp (IAC), which owns various brands (primarily in media) in over 100 countries. Among the other companies that they own are HomeAdvisor, Investopedia, and The Daily Beast.
And while Turo remains a private company, AirBnB has been publically listed. And AirBnB does have several subsidiaries, including HotelTonight, Accomable, Deco Software Inc., and Trip4real Experiences.
Can You Make A Living On Turo or AirBnB?
If you’re looking into using either AirBnB or Turo (or both) for a passive income, you are certainly not alone. Rather than creating your business’ infrastructure, such as payment processing, marketing tools, or legal departments, real estate owners have turned to AirBnB to facilitate the various mechanisms involved in short-term property management.
While Air BnB does take a cut of your fees, it still ends up saving you a lot of money because of the services and framework that AirBnB brings to the table.
On the other hand, Turo can help with similar mechanisms that facilitate car-sharing, ensuring that you’re paired with reliable people that aren’t going to crash or ruin your car, facilitating transactions, and providing you with insurance.
But they do take a pretty substantial cut of your profits – although, if they are providing insurance for your car, they are also taking on a substantial amount of risk. So, considering that both offer very helpful platforms that can help you earn a passive income, is it possible for you to make a full-time living from Air BnB and Turo?
The answer is complex and can be a yes or a no, depending on many factors. Your Air BnB listing’s profitability will depend on the type of property you own, the number of properties that you own, where the properties are located and short-term demand for the area, who you’re competing with, your utility bills, housekeeping costs, occupancy rates, and many more factors.
Your Turo listing’s profitability will depend on the type of car you have, where your renters are picking it up (e.g., if you live near an airport and renters are picking it up from your home, it’s more profitable), fuel prices, your car’s fuel efficiency, the number of cars you own, the demand for bookings, insurance options and the season.
These are external variables outside of your control and need to be considered when evaluating your risks. However, there is also a range of strategies used by real estate owners and people aiming to build a fleet of cars, which can potentially serve as a primary source of income.
This involves developing marketing techniques and customer service skills, for example, which can turn out to be a full-time job in its own right. Most experts would recommend starting small and tweaking your strategy along the way as your fleet or property listings grow and you take on more customers.
If you are only renting out one property or one car at a time, however, Air BnB and Turo will not provide you with a sustainable income to maintain a reasonable standard of living.
Turo and Air BnB are very similar applications that have built a shared economy for vehicles and properties, respectively. The processing of registering and renting vehicles and properties are very similar, and they are both affordable to renters and profitable for the property and car owners.
While it involves a lot of work, it is also possible to make a living by listing multiple properties and vehicles on either platform or in combination. However, this depends on external variables, which can pose a risk to the feasibility of your venture.