Thinking about starting a Turo business in 2023 to create additional income? Or maybe you are already a host looking for ways to maximize utilization, well this is the video for you!
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So you're tired of trading all your time for money.
And this year you tell yourself, you're gonna pick up a side hustle to make some extra income.
So you do some research online.
And you come across this business model called turo and figure.
This is something that you might be able to give it a shot or try.
But where exactly do you start whether you're completely new to term, or you already have some cars on the platform, but you kind of want to see what's in store for 2023.
And you'd like to get some insight from a Toro Grand Master on what exactly my 2023 predictions are or just get some tips on starting in this business for 2023.
Well, then you came to the right place I've been doing these Toro forecastings on my channel for the last couple years, I have to admit every year it's like a different obstacle, or a different challenge based on what's going on at the time.
So this is definitely a business that you got to bring multiple tools to the table.
One tool will not work for every year.
So something that's worked the last couple years might need some adjusting some shifting around.
So stay tuned to the very end of the video to make sure you get all the value out of this.
If you're new to the channel I, mostly make videos about my Toro business, but I also like to share my entrepreneurship journey in effort to motivate and inspire some upcoming entrepreneurs.
So if at any point in this video you're, getting value out of this, definitely go ahead and smash that like button.
And if you think you like watching content like this, then definitely go ahead and subscribe to this channel.
So 2022 is definitely more challenging than 2021 only because all the free government money that was floating around start pretty much drying up.
And the days where people used to put 2013 Nissan Altimas on the platform and rent them for sixty dollars plus a day.
Well, those days are pretty much over people are more inclined to spend free money than they are the money that they're working for so I'll start off by getting some quick tips to those looking to start off this year.
Then I'll get my prediction on how I feel like the car rental market is going to play out for the remainder of 2023.
So the first thing you want to do this year before jumping into the business is do some market research.
You don't want to just throw cars on the platform, blindly.
And just, you know, pretty much get prices out of thin air either you can go right on the turtle platform as a guest search your area, pick date that's further out I like to search at least a month out and pick a slower time of the week.
So I, usually like to search for cars from a Monday to a Thursday and I like to pick this date to be a month out.
This ensures that I'll pull up as many listings in my area as possible.
Just to see what my market looks like.
You can also use the Toro calculator to try to search on a particular vehicle to see what the average revenue for that vehicle is.
But take this number with a grain of salt, because Toro is just throwing off the averages and a website that I like to use is carsync.io it's, a great place to do market research.
You can see what cars in your area go for or how much the price a car as far as the low and the high.
But this is also averages coming right from Toro's website.
So again, take this with a grain of salt, but carsync.io is also great for when you do list your car on the platform because you could track different metrics, and you could track your reservations it'll even show you if the guest is writing your cards to repeat, yes, or a first time, guess? And you can also send automated messages or templates right to the guest so I like to use this.
When a guest books, my vehicle, they get some instructions right off the bat.
And when the reservation is almost over like an hour before it's over the guests also receive a message, and you can even put an automated message in there for halfway through the trip, just to kind of check on the guests.
So carsync.io is my go-to spot for all these things and I'm going to leave the link in the description for both these websites that I mentioned so check this out, and let me know which one you prefer.
So the next tip number two, don't participate in the race to the bottom as you're doing Market Research in your area.
You might come across some cars that seem like the deal is too good to be true.
For example, you might see a Mercedes C-Class or something going for 50 or 60 dollars a day and you're probably wondering, how does this host make money off such low prices on a high higher end luxury car? Well, to put in simpler terms, they're, not making money.
You have to understand that the car rental market is like any other Market.
It has its ups its downs.
And you have the right time to buy and the wrong time to buy and there's a lot of factors that go in whether or not somebody is profitable, the amount they paid for their car.
Their interest rates is it a cash car, finance, car expenses.
How high is their insurance their car payment? So it's really hard to tell if somebody is making a profit, just by looking at their daily price.
But on some Vehicles like I mentioned, this example, if somebody has a Mercedes let's say, a 2018, C-Class run for 50 a day, I'm, pretty sure that person is not making money because I've been selling cars for a while now and to get a better understanding of the car market we're coming off of all-time high for used car prices along with the used car prices being so high rental daily rates were all sold really high.
Because like I said, there was a lot of free money going around.
So people were charging out outrageous daily prices for regular economy cars.
So that kind of spoiled a lot of hosts because they had one or two cars going good.
And they figure, hey, let me go ahead and go all out add 10 more cars to this.
Well now that the market has kind of leveled off a little bit it's been a correction.
A lot of these people are stuck in car notes that they bought from last year.
And now that the daily prices are not sustainable anymore.
They're pretty much having to put that car up there for anything just to make some kind of money to help them pay down their car, no pay down their insurance.
So a lot of these people are what you call underwater in the deal and I gag.
Every time I see somebody online trying to teach other people how to acquire 10 cars with one inquiry because I'm like do these people not understand that there is this thing as over leverage and there's.
So many hosts out there that are underwater.
Because of this, they went listening to those so-called gurus bought their courses went in finance, 10 cars thing thinking that they were always going to be able to get 89 a day for that car.
But now that the market has corrected itself that car can probably go from about, you know, sixty dollars because you know, people don't have money like that anymore.
So they're putting it out there for fifty dollars a day just trying to pay off their car note, just trying to pay off their expenses, but they're, not actually netting any income and what's.
Even worse is the vehicle.
They purchased last year.
The value is actually tanked on that vehicle.
But they still owe the same amount.
So they're really getting killed to depreciation.
If that car was to get let's say in a total loss, right now they might get, for example, just throwing out.
Some rough numbers out there, I'm, not talking about any one specific person, but let's say, you bought the car last year for 28 000.
Now that car is only worth twenty thousand, but you've actually depreciated a little bit because you've been renting the car for six seven months.
So now let's say, the car is really worth about seventeen thousand.
Well, if the the car gets into a total loss situation, you might get a 17 000 check, but you still owe twenty eight thousand dollars.
Now a lot of people want to say, well, we're just going to get gap insurance, or we got gap insurance on it.
Well gap insurance is like, you know, if you if you're putting a car on Toro gap insurance is toss of a coin, because if they find out you're using the car for any commercial activity, which rental fits in that description, then they can actually avoid your Gap.
So I have seen that happen before, but I've also seen where they honored the Gap and paid it out.
So just get a better understanding of the market to know what's going on.
So when I say don't join the race to the bottom, I mean, don't feel like because somebody is pricing a Mercedes at fifty dollars.
Now you have to price your car, let's say, thirty dollars, I really don't.
Go anything loading 38 dollars.
The lowest I rented.
A car is 35 because that particular card already paid for itself multiple times over I would never list.
The car on the platform form for thirty dollars that I have a car note on that I have insurance on that is just wasting your time and you're, definitely not netting anything at that point.
So don't just automatically assume that every host you see with a car on Toro is profitable, because if it doesn't make sense then they're most likely losing money.
So another tip for new hosts is Cash cars is better than Finance cars and leasing should never be an option.
It just doesn't work for this business.
Now, if you watch some of my other videos, you know, I'm always stressing this issue about cash cars.
Ninety percent of my inventory is Cash cars.
And sixty percent of those cash cars are already paid off or have already made enough Revenue to return the investment.
Now it could seem like financing is the better option because you're getting into a business with no money down.
And that seems to be the new thing to do, but getting into a business and putting a car on a platform, Without Really, knowing how much revenue to expect could be Risky Business.
And what could be even riskier if you don't have at least 6 to 12 months of expenses for that vehicle just on standby.
So a simple rule I like to use from my experience of doing this business, if you're going to finance a car, then make sure you keep your expenses under 300 a month and I mean, car, no insurance under 300.
So that means you might have to put some skin in the game.
You might have to put a down payment on that vehicle in order to bring that expense to that amount.
But I think that's a comfortable amount, especially if you're going to be in the economy game, which if you're just starting off, you should be in the economy game.
Nobody should be starting off with exotic or luxury cars.
The risk is just too high, especially if you don't have somebody that's on your team, that's already been doing this that's going to be coaching you step by step could be risky business.
So if you're if your expenses are 300 a month, even if you have a lower end month like my economy, Vehicles do anywhere from 600 up a month could be 600 to a thousand dollars.
So even if I'm at the low end of 600 and my expenses are 300 it, well, at least I'm, still netting, 300.
And if you're really serious about this business, you should be taking that 300 putting in a separate account, not touching it and planning on using that money to reinvest into more cash cards, or you can even use that money to save up another down payment and finance, another vehicle with some skin in the game again, keeping the expenses under 300.
And once you do that a couple times you'll have enough money to actually go and purchase a cash car.
Then you can keep the ratio in your inventory to about three to one every three Cash cars, get one finance, car, I think that's a very safe ratio, I know, a lot of hosts who started off with two or three cars and reinvest all their profit and buy all cash cars.
And they do that for two or three years and they're actually able to replace their nine to five and actually earn themselves more time Freedom.
So the last tip I'll give to new hosts is to make sure you do your own marketing Turtle does a great job in marketing.
And bringing leads in, but things start to get slow during the slow season.
Then you want to make sure you stand out from other Terror holes and there's.
Nothing stopping you from doing your own marketing there's.
Nothing stopping you from making a car on a website and having all your your vehicles, linked right to Toro there's.
Nothing stopping you from promoting your turo link.
It's, pretty easy to make a QR code that you can put on business cards or flyers or I've, seen hosts put QR codes on, um tags or tag covers just to kind of promote the car.
And a lot of my renters come from auto shops because their cars are being worked on so that's, a great place to promote your business.
And you can even cut the shopping on a deal or work out a deal with them for you for you to bring your car to them, and they bring you business.
And another thing that can help you out is a local Facebook page that highlights your business as a rental car company.
You don't have to put turtle on that Facebook page just put the name in your company and put rentals.
And when When anybody clicks the link, you can redirect them right to the Toro website.
Turo does not have an issue with this.
They don't have anything in their terms of service that says, you can't Market your cars.
So I, wouldn't, 100 rely on Toro, especially when things start to get a little slow, especially when you have five or more cars, you definitely want to take some marketing into your own hands.
Even though Turtle does do a great job in marketing there's.
Nothing stopping you from doing that and there's.
No reason your car should be sitting up while you're, not marketing them.
So where do I see turo and the rental car industry as a whole heading in 2023? Well, I think for 2023 it's gonna be what you call bearish if you're into stocks or crypto.
You understand the term bearish just means that there's still more room to the downside.
Now, all these markets doesn't matter if it's stocks or rental cars or whatever it's all controlled by two things fear and greed.
So when we're in a bearish market, the sentiment is more on the fear side.
So people are fearful because a lot of companies are cutting jobs.
The inflation is out of control interest rates are really high there's a lot of different things going on the economy right now that is not indicating that people will come across more money.
It actually looks like there's a lot more room to the downside.
And we could see that Trend the entire year.
Now, hopefully I'm wrong I'm just speculating, uh based on current events.
And what we just experienced in 2022.
So that means if people have less money in their pockets, then they're gonna put stuff off like vacationing or put off that higher end luxury car that they're going to use on the weekends they're, just gonna try to save their money for actual Necessities.
But what they can't hold off on is those Necessities like if people still have to get around, they still have to take their kids to school.
They still have to go to work and something happens to their primary vehicle.
Well, they're gonna need to get in the vehicle fast.
And a lot of these people that are on the edge for lack of a better terms, don't have the option of going to the dealership and getting a new car or getting a car note.
Because guess what banks are also cracking down on Cardinals they're, not giving them as easily as they once were they're looking over, um, each applicant, very carefully.
And a lot of people are getting denied.
And even for subprime, people are getting denied so that's, why this year I'm going to continue to Target economy vehicles, but I'm actually not planning on adding any vehicles to my fleet for at least six months because I also feel like there's more Market correction as far as used car prices are going and I feel like there is going to be a point this year, where it's going to be an ideal time to purchase vehicles, but I don't think it's going to be next month or the month after that I still feel like there's, still some more down room, some downward pressure to go in 2023.
But like I said, there will be a point where it's going to be a great time to purchase a vehicle.
And when you make money on Toro, you make money off the purchase of the vehicle.
If you can get the right vehicle for the right price, then pretty much it's, what I like to consider a win-win situation.
So I'm going to be patiently waiting for that time.
I have about 12 vehicles in my fleet right now that I'm sitting on.
So if something happens to one of those vehicles, I will definitely be replacing it, but other than that I'm, not going out looking for newer Vehicles because I want to be able to get the best deal possible and I plan on making content on this channel, where I'm watching the car market and watching prices whether they're going down or going up watching the interest rates on used car loans.
So if you guys are interested in things like that definitely make sure to subscribe to this channel, if you got any value out of this video, definitely hit the like button and I.
Appreciate you guys sharing this time with me and I will catch you guys next video.
You can do a few things to make more money on Turo. One is to list your car in a popular location. Another is to have a vehicle that's in high demand. Finally, consider lowering your price during off-peak times.Is it worth it to start a Turo business? ›
This isn't a good plan if you want surefire income. But if you're willing and able to take a risk in exchange for potential profits, that's a different story. Turo itself is making money, and hosts who rent out their personal cars are making a small personal profit too.How long does it take to get started on Turo? ›
“It takes Turo about 24 hours to approve new users. You can get approved to drive before you book a car by going to your account page. You can check your approval status on your account page. If you get denied, you may be asked for more information.Can you put a financed car on Turo? ›
Leased and financed vehicles are allowed.How much does the average Turo host make? ›
The Average Turo Hosts Make $500 to $1,000 Per Month
Turo's online calculator considers annual loan payments for your vehicle, average rental rates for your vehicle on Turo, and the estimated value of your vehicle, among other factors.
The amount of money you can make as a Turo host depends on a few factors, such as the type of car you have, the location of your car, and the demand for your car. Generally speaking, Turo hosts can make anywhere from $200 to $2,000 per month.Is Turo good passive income? ›
Turo says that the average car owner in the U.S. earns $500-plus per month on Turo. The average owner in the U.S. who lists more than three cars earns over $3,000+ per month. That's a lot of passive income.Where is Turo used the most? ›
Los Angeles keeps the crown. As Turo's largest market four years and counting, Los Angeles still reigns supreme as the hottest place to cash in on your car.How much can I make on Turo a month? ›
How Much Can You Actually Make on Turo? According to Turo's official website, the highest earnings are about $1,365 per month. The amount depends on your vehicle and type of insurance, with the Porche Boxter earning the highest.How often do cars get rented on Turo? ›
If you're able to obtain a vehicle and rent for that amount, chances are your car will be rented around 22+ days a month. People will also frequent your rental more often and you'll get a bunch of repeat renters. It's also pretty hard to undercut the market when you can't get a good deal on a car.
With real-time tracking, you can also set up speed alerts to make sure that your Turo rental is being driven safely. You get an alert whenever the driver exceeds the speed limit, and then you can use that information to take necessary action.Why was i denied on Turo? ›
Note: Turo has the right to decline your trip request and remove you from the platform because of your auto insurance score, criminal background, driving record, or any other reason. If we deny you access to Turo, find out whether you can resolve your problem booking a car.Is Turo based off credit? ›
Turo considers AIS when evaluating new guests in the US and Canada. Doing so helps us keep our platform safe and affordable for everyone. We receive AIS from the credit reporting agency TransUnion. TransUnion uses some elements of your credit report to come up with your AIS, which is not the same as a credit score.Why can't i get a car on Turo? ›
Check eligibility requirements.
Requirements with regard to age, license, identification, and communication differ by region. If you don't meet the eligibility requirements in your area, you'll be unable to book a car.
Yes. If you're a Turo host, the IRS will expect you to file self-employment taxes, as long as you “materially participated” in your own car rental business. That applies to basically all Turo hosts, as long as they're the only person involved in renting out their car (other than, potentially, their spouse).Is car rental business profitable? ›
The profit margins are about 6% for most car rental businesses, but if you find the right location and negotiate well with fleet insurance companies and credit card processing services then your profit margin can be much higher (similar to how Uber works).