Three teens are taking on Hertz, Avis and Enterprise — the three giants of the car rental industry — with a new business model that should delight travelers.
ABC News reports Shri Graneshram, 19, Kevin Petrovic, 19, and Rajul Zaparde, 18, dropped out of Harvard, Princeton and M.I.T. because they decided they had an idea paved with gold.
When people go to the airport to fly out of town, they pay big bucks to park a car that sits unused while the owner is traveling around the country or around the world.
So, the teens thought, why not offer other inbound travelers the opportunity to rent the car and make money on it when the owner is out of town — instead of the owner having to pay to park the thing?
And that was the birth of their business, called FlightCar.
FlightCar.com launched at San Francisco International Airport with a customer base of 1,400 and they've orchestrated 1,500 rentals to date. Travelers parking their cars rent them to other travelers, making up to $10 a day. All renters are pre-screened and the rentals are insured up to $1 million, according to the company's website.
Airports and rental companies are furious. So too is the city of San Francisco, because cities get a cut of the exorbitant rental rates from the incumbent players at airports.
I recently had a $13 rental that was $38 after all the junk fees. So you have these disrupters playing the match game to drive down the price of airport rentals, even though they operate from a base that’s off-site.
FlightCar plans to launch another operation in Boston, and they’re looking at a third off-site airport location elsewhere in the country before the year is out.
Consumer expert Clark Howard's column appears here each Thursday in conjunction with Deal Spotter, a weekly print section in The Atlanta Journal-Constitution. Find more answers to your consumer questions at Clark's website.
-- Clark Howard -- Save More, Spend Less, Avoid Rip-offs -- for the Atlanta Bargain Hunter blog
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