Rent my ride Car-sharing app Turo enters Germany with Daimler partnership

US car-sharing provider Turo has rolled out service in Europe’s largest economy. With an investment from Daimler, the startup hopes to quickly outpace competitors in a crowded market.
Quelle: dpa
My Benz is your Benz.
(Source: dpa)

As a nation that prides itself with motor pioneers like Gottlieb Daimler, Ferdinand Porsche or Rudolf Diesel, Germans like to think their fondness for cars is something special and unique. But Lebanese-American entrepreneur Andre Haddad begs to differ. “In America, we love our cars, too,” he said.

The chief executive of Turo, a peer-to-peer car-sharing platform, has found Americans more than happy to entrust their car keys to complete strangers for a few days in return for hard cash, just as they’ve been doing for years with their own homes on Airbnb. Now as Turo expands in Germany, Mr. Haddad is confident of winning over German car owners as he has their American counterparts. Founded in 2009, Francisco-based Turo claims to have signed up more than 200,000 vehicles to its service and registered more than 5 million user across 4,500 cities in the US, Canada and Britain.

The analogy with Airbnb is clear to see. Turo users access the service via the company’s website or its app. Then they enter which vehicle they need, for how long and where, and for a commission the platform puts them in touch with car owners who meet those requirements. In Germany, Turo is partnering with Allianz to insure vehicles on its platform against costs related to accidents and damages, on both the owner and the renter side.

CEO Andre Haddad aims for no less than “fundamentally changing the economics of car ownership.”

Although Turo is a newcomer in Germany, it isn’t starting from scratch. Last September, the company acquired Croove, a rival launched by Daimler's Mercedes-Benz brand. Croove rolled out service first in Munich in December 2016 and then in Berlin a few months later. Daimler backed Turo's purchase of Croove.

For the maker of premium Mercedes, this is far from the first partnership with a mobility start-up. Daimler owns urban car-rental company Car2Go and has in recent years invested in over a dozen firms in Germany, Europe, North America or the Middle East (see gallery).

Turo is hardly the first car-sharing provider to make inroads in the German market. European market leader Drivy boasts 1.5 million users and 45,000 cars in six countries including Germany and the UK. “We are very satisfied with Drivy’s growth in Germany,” country manager Nils Rossmeisl told DPA. With more than 6,000 cars and over 200,000 users, Germany is Drivy’s second-largest market after France, its domestic market. Mr. Rossmeisl said his company’s main focus in Germany was to first boost awareness of car sharing opportunities with car owners and potential renters.

Another competitor already present is Holland-based SnappCar, which boasts 400,000 users and about 45,000 cars in the Netherlands and Scandinavia. In Germany, it offers its service in six cities. Both Drivy and SnappCar have acquired a German provider to gain a foothold in the country; both insure the users’ cars with Allianz.

On the other hand, Berlin-based Getaway is struggling to kick into high gear. The start-up founded in 2015 said it had 4,000 users of it app and 700 registered car owners as of last September.

Turo’s target on the German market, however, is pretty straightforward: becoming the market leader by the end of the year. “The business is growing very fast,” CEO Mr. Haddad said. He believes that it could take just six to twelve months to reach a critical mass of users in Berlin and Munich. In smaller cities like Stuttgart, Frankfurt or Cologne, that will probably take up to three years.

German country manager Marcus Riecke, a former executive at US start-up Nextdoor, banks on foreign visitors in Germany to boost demand. Besides, Mr. Riecke and Mr. Haddad, who used to work together at eBay a decade ago, believe that the sharing economy is popular in the country. They may be onto something. A 2016 poll found that 48 percent of German respondents would happily rent out their own vehicles. Overall, 55 percent of respondents in Europe agreed.

If Turo succeeds in Germany, Mr. Haddad will come one step closer to achieving an even loftier goal: “Putting the world's 1 billion cars to better use, and fundamentally changing the economics of car ownership.”

Jean-Michel Hauteville is an editor with Handelsblatt Global in Berlin. To reach the author: [email protected].