Executives at Renting Finders, ViveLaCar and CarFlip discussed the challenges, opportunities and their learnings operating car subscription-focused marketplaces in Europe and Brazil.

From the left to the right: Konstantin Kalabin (AIM Group), Arturo Alvarez Podhorecka (Renting Finders), Mathias Albert (ViveLaCar) and J. R. Caporal (CarFlip)

The three companies have different business models, but all executives agreed the car rental business isn’t much regulated as the leasing business in certain European countries.

CEO and co-founder Arturo Alvarez Podhorecka defined Renting Finders as a renting transactional marketplace, which targets longer-term rentals of up to five years.

Podhorecka said the car subscription model is booming in Spain. About 26% of car registrations in Spain goes into renting, up from 16% four years ago, the executive said. “It could reach a third next year,” he said, adding the average rental term in Spain is between three to four years.

In terms of definitions, the three executives agreed that a car subscription is, indeed, a car rental agreement.

ViveLaCar offers renting and leasing products. It doesn’t own the cars it rents or leases, as opposed to CarFlip in Brazil. “The dealer or the OEM owns it,” CEO Mathias Albert explained.

“Subscription and rentals aren’t regulated, especially in Germany. We combine a huge flexibility if consumers cannot pay for it anymore. We are looking to the subscriber in a different way,” Albert said.

CarFlip, on the other hand, buys the cars from dealers and resells to the customer. “We are asset-heavy,” J. R. Caporal, CEO at CarFlip said.

The used car-focused marketplace targets customers who can’t get financing. “We target the customers who go to a dealership and whose financing is denied. The dealer sells the car to us. We buy the car and rent it to the customer. We work with both independent and franchise dealers,” he said.

Caporal said about 60% of car financing applications are rejected in Brazil, which represents a huge opportunity for CarFlip’s business model.

“In Brazil, we have a specific situation. Most of finance applications are denied – about 60%. Financing applications sometimes require higher down payments or a shorter payment period, so costumers cannot do it,” he said.

Asked by the audience if the Stellantis-backed could launch a similar business in other countries, Caporal said such decision would depend on whether a similar market structure exists.

Renting Finders’ Podhorecka and ViveLaCar’s Albert said average time use for car rentals is increasing.

“The time is increasing because of pricing. The longer you rent a car for, the cheaper the price. Everybody is trying to keep the client for a longer time,” Podhorecka said.

“We see a huge change coming. Dealers want to keep cars longer instead of selling them immediately. We hope (in the future) 20% of the cars dealers trade can be subscription-based, so after a certain period, dealers can sell the car afterwards,” Albert said. “(Car subscriptions) will be an important of the dealers’ business plans in the future,” Albert said.

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