Save through Car-Sharing – or Make Bank by Sharing Your Car!

If there’s one thing South Africans are more proud of than our sporting achievements, it’s our rides. Our whips. Our pride & joy.

There are many convincing arguments for car ownership – but it can be expensive to buy one. High import duties and the weakness of the Rand against major currencies – never mind a petrol price that’s up 23% this year, alone - means that buying a car in South Africa is way beyond the means of most of us.

With the combination of the pressures and supply chain disruptions caused by COVID-19 and the global chip shortage which has made new car stock scarce, used car prices are up 7% on average since last year, so going second-hand is pretty pricey too.

If you need a car to get around because you can’t rely on public transport for whatever reason – and there are plenty of them - what’s the best option between buying, leasing, and car-sharing?

Rock a Ride

Let’s look at South Africa’s second-best-selling new passenger car of 2021 – the VW Polo Vivo, with 21 877 units sold. It was second to the Toyota Hilux in the sales chart (36 085), but let’s use it as an example for the sake of a more economical comparison.

Buckle Down and Buy

If you were buying it new, you’d be forking out R235 200 for the entry-level 1.4 Trendline. Odds are you’d have to finance it, which could push the total cost up to R320 000 over the course of a five-year repayment plan at roughly R5 500 per month. You’d have to insure it and possibly add a tracking unit, which could cost you at least R1  100 per month. You’ll need fuel for it – and the rising oil price is sending the cost of petrol through the roof. Say a 45-litre tank costs you nearly R1 100 to fill up and you use a very conservative two tanks a month. Add service and licensing costs of R3 000 per year and new tyres at R4 000 every 2-3 years and you start to understand the magnitude of your investment. Effectively, you’re looking at around R120 000 per year – R10 000 per month - to operate your car. Let’s break that down into a daily cost – on average, it’s around R330 per day.

Lease and Release

If that’s terrifying, you could look at leasing a car from an agency. For a Polo Vivo Trendline or similar, with comprehensive insurance, you’re looking at a monthly cost of around R6 100 on a 24-month deal – and you’d still need to pay for two tanks of petrol a month, on top of that, so let’s call it R8 300, or R268 a day. That seems like a bargain, but remember that after paying R199 200 (85% of the purchase price of a new Polo Vivo) over the course of two years, you have nothing to show for it because you’ll simply hand the car back. It’s a cost-effective solution, but is it a sound financial decision?

Share and Earn

Now let’s look at car-sharing. If you're thinking about buying a car or are already pressured by the cost of owning one, then the case for car-sharing is a compelling one.

The concept of car-sharing is based on the fact that most cars sit idle for 90% of the time. Collide this with the growing demand for mobility stimulated by tourism and those who simply cannot afford to buy or lease one and you have a win-win solution for all.

How? By listing, and renting out your car on our online car-sharing platform you get to earn income from your car when you’re not using it. And, while you earn, those who rent your car through our convenient peer-to-peer exchange benefit from a rate that is on average 25% lower than a standard car rental.

Car-sharing is already successful globally, with companies such as Turo in the United States and Snappcar in Europe, having proven that peer-to-peer car rental is growing exponentially.

Car-sharing a VW Polo Vivo can earn you around R350 per day - with your car's safety assured, from screenings, tracking, insurance, and roadside assistance that covers both renters and car owners during each booking.

On average, listed car owners can earn between R3 000 and R7 500 per month off-peak, while their earnings can jump to between R5 000 and

R12 000 during peak season.

Remember, your car is costing you money while it sits outside your house, so why not rent it out to cover those costs – and even make a profit? Remember the daily cost of ownership we worked out was around R330 – so if you’re able to rent it out for R350 and up, you’re paying off your car and making money at the same time.

Let’s look at the comparison in a table for that VW Polo Vivo:

 

Duration Buying Leasing Car-Sharing
      Ownership Rental Earnings
Monthly R10 000 R 8000 R10 000 R10 850
Daily R330 R 268 R330 R350

Looking at the last column, car owners can enjoy the perks of car-sharing, perhaps making more than the daily costs of owning and maintaining their vehicle, through RentMyRide. Some listed owners have even bought and listed a second car, exclusively renting it out on RentMyRide, and watching it pay itself off - with profit to bank.

Think about it – be smart, be safe and make some cash off your whip.

Visit www.RentMyRide.co.za - like us on Facebook @RentMyRide, and follow us @RentMyRide_SA on Instagram.

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