Share and enjoy.
A blue Mercedes-Benz C-Class is gleaming in the sunshine. This is how it looks in its parking space outside a home in Munich – and also virtually on Croove, the new carsharing platform from Mercedes-Benz. The idea behind this new service is private car rentals for private users, also known as peer-to-peer.
But how does it work? It’s simple – the Croove app guides the vehicle owner through every step. Vehicle details, such as model, trim level, photos, availability, price and location of handover, are uploaded to the platform in no time, making it easy to get started. Now the C-Class is available to rent by registered Croove users (www.letscroove.com). Clear and simple communication between the two parties regarding time, duration and other details ensures the transaction is transparent and reliable. The vehicle owner can now optimise usage of the vehicle and earn money at the same time.
Earn money from your car
Sharing something you own with others is the basic idea behind the sharing economy. Daimler launched car2go in 2008 and is a pioneer of the sharing idea in the automotive sector. The new Croove platform complements this sharing idea with a product that is significantly cheaper than that offered by commercial providers: “Millions of cars are only used for a few hours a week – and we take care of the rest of the time,” says Daniel Rohrhirsch, founder of Croove. The app enables users to quickly and easily rent a well-looked-after and safe vehicle to match their mobility requirements, without being tied to a fixed rental station.
The app delivers the company car
Croove launched in Munich in early December 2016. On completion of the pilot phase it will be decided whether to extend the scheme to other German cities. The project is embedded into Mercedes-Benz Cars’ CASE strategy, which focuses on the topics of Connectivity, Autonomous driving, Sharing and Electrification, which are important issues for the future.
For example, Ms. X has just received a meeting request on her smartphone. She has been pencilled in, along with two co-workers, to visit a customer in the Bavarian Forest, which might offer lovely countryside views, but is very difficult to reach by public transport.
Ms. X selects the coming Monday as the date on the Croove app and can immediately see a list of available vehicles. She chooses an E-Class which is parked nearby and costs €61. Current alternatives include an A-Class for €44 and a CLA for €47. Fuel costs are added on top. Vehicles from other manufacturers are also available.
' Millions of cars are only used for a few hours a week – and we take care of the rest of the time. '
Daniel Rohrhirsch, founder of Croove
Payment via the app
Ease of use, transparency and security are top priorities for Croove. Vehicle owners can create a profile containing the vehicle data and equipment level. The vehicle must be in good condition and not more than 15 years old.
Potential rental customers, who must also register, must be at least 21 years old and hold a valid driving licence. Vehicle owner and rental customer check the vehicle’s condition at collection and return and document it in a digital checklist in the Croove app. Cashless payment is made via the app. Done!
To continue our example, after Ms. X and her co-workers have completed their business trip to the depths of the Bavarian countryside in the C-Class, they return it to the owner’s parking space. Ms. X quickly leaves a rating via her smartphone, and the vehicle appears as available in the Croove app for the next user.
The smartphone as the gateway.
Mine, yours, ours
Sharing is already well established in many other industries and countries. And it’s not just about maximising the commercial value of your possessions. For many users the social aspect is also important. Somebody offers something, somebody else needs it – and the two are brought together by a common platform. Sharing has become something of an ethical stance for some people, with many viewing responsible sharing as good sharing. And in the process private ownership becomes more communal.
Europe is currently the largest market for carsharing with around 2.2 million members across several communities and almost 60,000 vehicles, according to a recent study by Berkeley, University of California. Germany is the largest single market, with North America in second place with over 1.6 million users and nearly 25,000 vehicles. Significant growth has been forecast for the carsharing sector around the world, but most of all in China.
It’s fun to place your trust in others
Although privately owned cars are still in the majority, this study, and others, points to a market with strong potential. Some of the key driving forces behind carsharing are the increase in population density, especially in urban centres, the fall in private car ownership, improvements to local public transport and mobility strategies that focus on multimodal traffic, according to a study published in August 2016 by the Center for Automotive Research (CAR) in Ann Arbor, USA.
On top of that, there is also a general change in property and mobility habits. The sharing economy is particularly popular with 18–24 year-olds, households with an annual income of between US$50,000 and US$75,000, and users with children under the age of 18, according to figures published by accountancy firm PricewaterhouseCooper in 2015. But beyond all the practical considerations, for a majority of 63 percent of respondents there is an additional incentive. The interaction with other people that is an essential part of sharing and the mutual trust required are more fun than a purely business relationship with a traditional company. Sharing is a social experience that for many is a form of social enrichment.
Make money and bring benefit to people.
Hop into a car and leave the city behind you.
Earning money from your car is easier than you might think. If you don't need your car at the moment, you can offer it for rental via the www.letscroove.com platform, initially in the greater Munich area, at no cost to you. The vehicles available at the launch of the pilot scheme range from a VW Polo 1.2 at €28 to a Ford Mustang 5.0 Cabriolet for €143 a day. 'The exact price is determined by the vehicle owner. Our app makes a price suggestion based on the model and age of the car, but the vehicle owner can enter a different price. We are open to all makes of car,' explains Daniel Rohrhirsch, CEO of Croove. 'In contrast to a regular car rental, you don't just get a car from a certain price bracket – you get exactly the make and model you want.'
Does renting out your car make financial sense in the long-term? A calculator on the Croove website helps you work it out. If your vehicle has a market value of €40,000, for example, then renting it out for eight days a month could bring in around €6,000 per year, or €500 per month.
The process of renting it out could not be easier. Everything runs via the Croove app, which also takes care of the formalities of the handover. This saves the time and hassle of complicated forms, countless signatures and small print. The Croove platform receives 30 percent of the rental cost. 'We also provide a delivery and collection service in Munich's city centre for €15,' says product manager Christian Röhm.
The total price includes the use of the vehicle for 24 hours over a distance of up to 300 kilometres and a special insurance package from Allianz. This covers the vehicle over the entire rental period independently of the vehicle's usual liability insurance and collision insurance. This provides the maximum of protection for both parties. 'We expect initial rental periods to be short, as most people will want to try out the service first', says Böhm, looking ahead. 'In the medium term, however, the majority of rentals will be over several days.' The fifteen-strong team at Croove also predicts that potential rental customers will use the vehicles mainly for leisure activities, such as going skiing, walking in the mountains or visiting the lakes in the surrounding region. 'That's why Munich is the ideal launch pad for our company,' adds Rohrhirsch. However, the aim is to make Croove a viable alternative across Germany to regular car rental companies such as Avis, Sixt and Europcar.