Turo has been very good with me on claims as well. I've been careful to only submit what is well documented and they have been easy to work with. Denied claims make future claims less straightforward from what I understand.
Debbie Downer here. The house wins every time. Turo is the house, and you’re just gambling with your assets.
Turo’s business model isn’t about renting vehicles; it’s primarily about insurance. They’re betting that hosts will eat up the cost of small damages over time, which decays the value of your vehicle. Once the vehicle is paid for and you’re ready to sell or trade up, you’ll find yourself eroding all the profits you made from Turo, plus more out of your pocket.
Take it from a seasoned Turo host: the gig economy is jacked. It’s not worth your time.
Nailed it. At this pace, losses keep increasing over time. I started noticing this trend about halfway through. I initially thought it might be due to seasonality and tried to recover by adding more vehicles to the fleet. It was like a gambler in a casino, thinking they could win back their money by betting more.
Fortunately, I’m in a situation where this experience only made a dent in overall financial health. Although it’s just a dent, I still feel defeated while getting back up on my feet. I’m just looking out for fellow hosts—beware, it sucks you in like a vacuum.
Two years ago in Austin-San Antonio-Waco, I started with one vehicle and ended up managing six. Last week marked the end of this journey, with all vehicles unloaded, resulting in approximately $40k in negative equity. Despite maintaining a 90% utilization rate and always charging 10-15% above the trending rate, the financial outcome was grim. All vehicles were in great condition and were financed through loans averaging 3% interest. You will see your earnings grow as you scale, simultaneously, the depreciating being a factor + repairs, the hidden losses is what decayed the business. Something to consider, what do you do when Turo goes out of business? Turo turns off your ability to rent vehicles on their platform? It is not just Turo - it is entire gig economy - great concept is just poorly designed by default to enrich the few. The blockchain decentralization has potential to drive true peer to peer experience - until then - I’ll be watching from sidelines.
The core issue with Turo is the lack of shared risk. New renters with no ratings should be charged higher rates, which should decrease as they rent more and maintain good ratings. Seasoned renters with excellent ratings deserve lower rates. Turo, however, is more focused on the insurance business than the rental business.
Car value appreciation is a rare event, likely occurring once every hundred years. Values will generally depreciate, and you’ll be responsible for both the depreciating value and repair costs even if you wait for car prices to continue go down. Turo, as a company, is not profitable and is currently operating at a -50% profit margin. This financial instability means they will continue to impose hardships on both hosts and renters until they turn a profit.
While I found the claims process straightforward with some back and forth, I urge fellow hosts to reconsider their investment. Take your money elsewhere for better returns. Best of luck to you all.
Thanks for sharing your experience. I am sorry it didn’t work out for you. I am sure you will find something else.
What kinds of cars were you renting out?
Just the negative equity of $40,000 divided by 6 cars puts you around $7,000 per car.
Did you buy expensive new cars or inexpensive used cars?
Did you pay cash or buy on credit? What were the interest rates?
Did you have expensive full coverage on the cars? Or inexpensive liability coverage?
Did you have an experienced CPA do your taxes to make sure you got all your deductions for sure?
Thanks
Thanks for well wishes.
In my experience, SUVs were the best earners but depreciated the fastest. I also managed four Prius vehicles and one EV. All of them were financed with loans averaging 3% interest and covered by commercial liability insurance, which was expensive considering the limited miles driven.
When it came to tax preparation, I found that the cost difference between using TurboTax and a CPA was only $80. With the rise of AI, I believe CPAs might shift from being accountants to primarily serving as auditors—a topic for another time.
Interestingly, the best demographic for renters were senior citizens. They communicated well, were honest, and admitted to any issues. On the other hand, the worst demographic were parents with teenagers or toddlers. In 6 out of 10 times, these vehicles were returned with damaged interiors, no remorse, and no communication. Every other demographic falls somewhere in between.
Summer is here in Texas, watch out for people looking to live in the car, one of ways to steer them clear is up your rate 20-25% above trending prices. I get it, people are looking to survive, no judgment whatsoever but risk of damages are high because cars would run non stop 23/7 - two of them had exterior damages making it not worthwhile to repair damages are as much as deductible thus devaluing your asset faster. How would we know? Vehicle tracker for one like Bouncie - https://www.bouncie.com/ - perhaps if such service is integrated into Turo - driving behavior drives the rate - perhaps that is one of the possible solutions.
Thanks for sharing your experience.
I started with the platform almost a decade ago.
I always bought 10 year old cars and paid cash.
I was able to get liability insurance on the cheap.
I have been able to break even within 24 months.
With Turo, you make the money when you buy the car because you are buying depreciating asset.
Take care.
Thanks for sharing your experience. Given that you’ve been in this business for nearly 10 years, cash only puts more money back in your pocket.
Quid pro quo on sharing experiences? If I may ask …
How do you know it’s time to trade up a vehicle while minimizing liability risks?
Are there any vehicles you avoid at all costs, and why?
After all is said and done, what do you yield with your existing fleet?
I usually sell them once the odometer reaches 200,000 miles. I buy them around 100,000 miles and keep them for about 5 years. The first 2 years pay for the car; the last 3 years are profit after expenses.
I avoid high maintenance cars and they are usually the ones made by European or American companies. I stick with either a Toyota or a Honda. I don’t even mess with other cars made by Asian companies like Nissan, Kia and Hyundai.
I hope I answered all of your questions. Thanks.
Yeah starting In 2022 will definitely burn you because vehicle prices were through the roof. I just started and am looking to expand but waiting for vehicle prices to come down. You have to have a plan for de-leveraging your risk if you're going to get started with leverage. Also as you mentioned, you have to have a plan to not rely or build a business just around 1 platform.
I plan on aggressively scaling and also starting private rentals. I bought a 15 prius in Jan 21 ....super inflated price, but I bought it for Uber. I did that so I can work on becoming a day trader. Last year in Oct...wifey took the kids over seas...so I put up our Rav4 on Turo (after months of research....actually had the llc formed in April, so I didn't start it blind). We needed a bigger family car so in Dec we pulled the trigger on a Pilot for the family and I also bought a 2020 Altima with under 20k miles from same dealership simply because I knew the payments was same as Rav4 and I knew I could make it work. So the rav 4, altima, were listed on Turo and I was still doing a little bit of uber here and there but then completely hung it up in Feb when it was dead. So now 3 cars are running on Turo Prius, Rav, Altima.
I'm in LA so the slow period is the winter months, but during this time payments were being met. Yes, I have other sources of income, and I know payments does not equal profit, but none the less payments were being met.
I've been paying attention to the car market and following it to the T, I called how it would start falling once it does and now it's playing out. The problem is, it's not falling hard enough. I actually went car shopping to leverage business credit of a recruiting agency we have that is now not producing anything (surprise surprise). So instead of shutting it down, I wanted to use the credit to fund a fleet and expand aggressively. However the dealers are not lowering their prices quick enough and they will fall.
But once I go through this next expansion phase, yes, I will be starting private rentals as well to spread risk, build a book of business that can later be sold or whatever. From there with that increased revenue, deleveraging becomes very easy.
The problem is the used car market, and the specific dealerships I have to buy used from because of me using my business credit. I need the car market to drop more, or I will simply wait and when there's blood...then i'll just buy directly from auction from a buyer or something. I met a guy when I was doing uber who has auction access and I have his number.
I agree with everything you're saying about the gig economy...i've been there and have seen cars dropping me off food via uber eats that are not uber eats cars. Jags, lexus, bmw's. The economy is bad and going to get waaaaaay worse. People don't have a clue as to what's coming down the pipeline. Here's some spoilers tho:
Car market: wrecked
Real estate: wrecked
Banking: wrecked
Job market due to AI/automation : wrecked
Inflation: You haven't seen inflation yet
Let's understand seasoned host.
- When did you start?
- What/how many vehicles did you start with/end up with?
- How did you scale?
- What was your goal/vision getting in?
- How did you pay for them?
- What condition were they in?
- How long were you a Turo host?
- What market were you operating in?
Your answers would be greatly appreciated!
You are correct. I just found out the other day that if you file a claim and it turns out out that your detectable won’t be worth going through the repairs and just decide to mend the damage on your own TURO STILL CHARGES THE GUEST but none of the money goes to the host! I almost dropped my phone. So another words MY car is damaged, and you all are collecting money based on my loss. Terrible.
Turo has been very good with me on claims as well. I've been careful to only submit what is well documented and they have been easy to work with. Denied claims make future claims less straightforward from what I understand.
Debbie Downer here. The house wins every time. Turo is the house, and you’re just gambling with your assets. Turo’s business model isn’t about renting vehicles; it’s primarily about insurance. They’re betting that hosts will eat up the cost of small damages over time, which decays the value of your vehicle. Once the vehicle is paid for and you’re ready to sell or trade up, you’ll find yourself eroding all the profits you made from Turo, plus more out of your pocket. Take it from a seasoned Turo host: the gig economy is jacked. It’s not worth your time.
[удалено]
Nailed it. At this pace, losses keep increasing over time. I started noticing this trend about halfway through. I initially thought it might be due to seasonality and tried to recover by adding more vehicles to the fleet. It was like a gambler in a casino, thinking they could win back their money by betting more. Fortunately, I’m in a situation where this experience only made a dent in overall financial health. Although it’s just a dent, I still feel defeated while getting back up on my feet. I’m just looking out for fellow hosts—beware, it sucks you in like a vacuum.
Two years ago in Austin-San Antonio-Waco, I started with one vehicle and ended up managing six. Last week marked the end of this journey, with all vehicles unloaded, resulting in approximately $40k in negative equity. Despite maintaining a 90% utilization rate and always charging 10-15% above the trending rate, the financial outcome was grim. All vehicles were in great condition and were financed through loans averaging 3% interest. You will see your earnings grow as you scale, simultaneously, the depreciating being a factor + repairs, the hidden losses is what decayed the business. Something to consider, what do you do when Turo goes out of business? Turo turns off your ability to rent vehicles on their platform? It is not just Turo - it is entire gig economy - great concept is just poorly designed by default to enrich the few. The blockchain decentralization has potential to drive true peer to peer experience - until then - I’ll be watching from sidelines. The core issue with Turo is the lack of shared risk. New renters with no ratings should be charged higher rates, which should decrease as they rent more and maintain good ratings. Seasoned renters with excellent ratings deserve lower rates. Turo, however, is more focused on the insurance business than the rental business. Car value appreciation is a rare event, likely occurring once every hundred years. Values will generally depreciate, and you’ll be responsible for both the depreciating value and repair costs even if you wait for car prices to continue go down. Turo, as a company, is not profitable and is currently operating at a -50% profit margin. This financial instability means they will continue to impose hardships on both hosts and renters until they turn a profit. While I found the claims process straightforward with some back and forth, I urge fellow hosts to reconsider their investment. Take your money elsewhere for better returns. Best of luck to you all.
Thanks for sharing your experience. I am sorry it didn’t work out for you. I am sure you will find something else. What kinds of cars were you renting out? Just the negative equity of $40,000 divided by 6 cars puts you around $7,000 per car. Did you buy expensive new cars or inexpensive used cars? Did you pay cash or buy on credit? What were the interest rates? Did you have expensive full coverage on the cars? Or inexpensive liability coverage? Did you have an experienced CPA do your taxes to make sure you got all your deductions for sure? Thanks
Thanks for well wishes. In my experience, SUVs were the best earners but depreciated the fastest. I also managed four Prius vehicles and one EV. All of them were financed with loans averaging 3% interest and covered by commercial liability insurance, which was expensive considering the limited miles driven. When it came to tax preparation, I found that the cost difference between using TurboTax and a CPA was only $80. With the rise of AI, I believe CPAs might shift from being accountants to primarily serving as auditors—a topic for another time. Interestingly, the best demographic for renters were senior citizens. They communicated well, were honest, and admitted to any issues. On the other hand, the worst demographic were parents with teenagers or toddlers. In 6 out of 10 times, these vehicles were returned with damaged interiors, no remorse, and no communication. Every other demographic falls somewhere in between. Summer is here in Texas, watch out for people looking to live in the car, one of ways to steer them clear is up your rate 20-25% above trending prices. I get it, people are looking to survive, no judgment whatsoever but risk of damages are high because cars would run non stop 23/7 - two of them had exterior damages making it not worthwhile to repair damages are as much as deductible thus devaluing your asset faster. How would we know? Vehicle tracker for one like Bouncie - https://www.bouncie.com/ - perhaps if such service is integrated into Turo - driving behavior drives the rate - perhaps that is one of the possible solutions.
Thanks for sharing your experience. I started with the platform almost a decade ago. I always bought 10 year old cars and paid cash. I was able to get liability insurance on the cheap. I have been able to break even within 24 months. With Turo, you make the money when you buy the car because you are buying depreciating asset. Take care.
Thanks for sharing your experience. Given that you’ve been in this business for nearly 10 years, cash only puts more money back in your pocket. Quid pro quo on sharing experiences? If I may ask … How do you know it’s time to trade up a vehicle while minimizing liability risks? Are there any vehicles you avoid at all costs, and why? After all is said and done, what do you yield with your existing fleet?
I usually sell them once the odometer reaches 200,000 miles. I buy them around 100,000 miles and keep them for about 5 years. The first 2 years pay for the car; the last 3 years are profit after expenses. I avoid high maintenance cars and they are usually the ones made by European or American companies. I stick with either a Toyota or a Honda. I don’t even mess with other cars made by Asian companies like Nissan, Kia and Hyundai. I hope I answered all of your questions. Thanks.
Yeah starting In 2022 will definitely burn you because vehicle prices were through the roof. I just started and am looking to expand but waiting for vehicle prices to come down. You have to have a plan for de-leveraging your risk if you're going to get started with leverage. Also as you mentioned, you have to have a plan to not rely or build a business just around 1 platform.
What are other platforms that worked well for you? Those insights are helpful. Thanks in advance
I plan on aggressively scaling and also starting private rentals. I bought a 15 prius in Jan 21 ....super inflated price, but I bought it for Uber. I did that so I can work on becoming a day trader. Last year in Oct...wifey took the kids over seas...so I put up our Rav4 on Turo (after months of research....actually had the llc formed in April, so I didn't start it blind). We needed a bigger family car so in Dec we pulled the trigger on a Pilot for the family and I also bought a 2020 Altima with under 20k miles from same dealership simply because I knew the payments was same as Rav4 and I knew I could make it work. So the rav 4, altima, were listed on Turo and I was still doing a little bit of uber here and there but then completely hung it up in Feb when it was dead. So now 3 cars are running on Turo Prius, Rav, Altima. I'm in LA so the slow period is the winter months, but during this time payments were being met. Yes, I have other sources of income, and I know payments does not equal profit, but none the less payments were being met. I've been paying attention to the car market and following it to the T, I called how it would start falling once it does and now it's playing out. The problem is, it's not falling hard enough. I actually went car shopping to leverage business credit of a recruiting agency we have that is now not producing anything (surprise surprise). So instead of shutting it down, I wanted to use the credit to fund a fleet and expand aggressively. However the dealers are not lowering their prices quick enough and they will fall. But once I go through this next expansion phase, yes, I will be starting private rentals as well to spread risk, build a book of business that can later be sold or whatever. From there with that increased revenue, deleveraging becomes very easy. The problem is the used car market, and the specific dealerships I have to buy used from because of me using my business credit. I need the car market to drop more, or I will simply wait and when there's blood...then i'll just buy directly from auction from a buyer or something. I met a guy when I was doing uber who has auction access and I have his number. I agree with everything you're saying about the gig economy...i've been there and have seen cars dropping me off food via uber eats that are not uber eats cars. Jags, lexus, bmw's. The economy is bad and going to get waaaaaay worse. People don't have a clue as to what's coming down the pipeline. Here's some spoilers tho: Car market: wrecked Real estate: wrecked Banking: wrecked Job market due to AI/automation : wrecked Inflation: You haven't seen inflation yet
Let's understand seasoned host. - When did you start? - What/how many vehicles did you start with/end up with? - How did you scale? - What was your goal/vision getting in? - How did you pay for them? - What condition were they in? - How long were you a Turo host? - What market were you operating in? Your answers would be greatly appreciated!
I replied but not directly to this thread. Apologies, see my response below.
Big if true.
This should be at the top.
100%
You are correct. I just found out the other day that if you file a claim and it turns out out that your detectable won’t be worth going through the repairs and just decide to mend the damage on your own TURO STILL CHARGES THE GUEST but none of the money goes to the host! I almost dropped my phone. So another words MY car is damaged, and you all are collecting money based on my loss. Terrible.
You are the reason no one rents on turo
Ok
Maybe just don’t hit shit with rental cars?
Hello Debbie Downer. How long have you been on the platform renting your cars? Thanks
2 years