ONLINE CAR RENTAL BUSINESS DRIVEMYCAR HITS TOP GEAR
Written on the 20 March 2017 by Ben Hall
PEER-to-peer car rental business DriveMyCar has confirmed the rapid rise in the sharing economy with a 54 per cent increase in the number of rental days so far this calendar year compared to the full December 2016 quarter.
DriveMyCar, a key business in the Collaborate Corporation Limited (ASX:CL8) stable, reported 16,766 net rental days booked during January, February and the first 17 days of March today.
Chris Noone, Collaborate Corporation CEO, says improvements in marketing and the addition of new vehicles and strong demand in rentals for UberX drivers had helped generate the record sales.
"It is most pleasing that strong growth is being experienced in the March quarter, which is traditionally weaker after the seasonally strong December quarter," Noone said.
"The board is exceptionally pleased with these results with the growth in rentals being well above expectations," he said.
DriveMyCar sales records for net rental days booked have increased in January and February and the company reported another record for March after just 17 days with 5,995 bookings.
The company recently purchased 101 Subaru Impreza vehicles to add to their inventory and this has helped drive additional sales with 61 per cent of them booked within two days of official availability, mostly by UberX drivers and general renters.
UberX drivers are also helping drive the positive numbers with the ride sharing operators recording a 116 per cent growth in net rental days for the March Quarter to date.
Noone said the addition of the Imprezas would contribute to a significant increase in DriveMyCar revenue and the full impact of these rentals on revenue and cash flow would not be realised until after the March Quarter.
He also said the launch of the Subaru Impreza fleet had shown "few signs of cannibalisation" of existing UberX rentals as the vast majority of Subaru rentals provided to UberX drivers were for new customer relationships.
Gross revenue, which lags rental days booked as these are delivered over several months ahead, is also rising for the business with February 2017 the second highest recorded after the peak month of December 2016 which benefited from seasonal demand and price increases.
Noone said the complete results for the full March 2017 quarter will be released in April 2017.
Collaborate Corporation Limited is a listed company which focuses on peer-to-peer or "sharing economy" businesses and also includes MyCaravan.com.au, a caravan rental business, and Mobilise.com which is set to launch later this year as a rental marketplace for under-utilised assets.
By 12.40pm (AEST) CL8 shares were trading 14 per cent higher at $0.024.
Business News Australia
Author: Ben Hall