Sharing Economy Vehicle Rental (Turo, etc.) Financial Analysis

Car Services, Financial Model, Tourism & Attractions

5-year Financial Projections, Budget, Cash Flow Analysis, Cash Flow Projections, Cash on Cash Yield, Cash-on-Cash Multiple, Cost Calculation, Cost Projections, Discount Rate, Excel, Financial Analysis, Financial Feasibility, Financial Model, Financial Modeling, Financial Planning, Financial Projections, Financial Ratios, Financial Reporting, Financial Statements, Financing, Forecast, Forecasting, Income Statement, Investment Multiple, Investor Cash Flows, IRR (Internal Rate of Return), Net Yield, Passive Income, Profitability Analysis, Revenue Projections, Valuation

Video Overview:

This model is a crucial tool for people thinking about buying, leasing, or registering their existing vehicle on vehicle sharing rental platforms, such as Turo, to ensure they are making an adequate financial return for their efforts. This highly-dynamic model can be used to analyze the financial performance of a sharing economy vehicle rental (Turo, etc.) on an IRR, NPV, and multiple of capital (MoC) basis. The model allows the user to input operating, purchase, and lease assumptions unique to their business model.

The operating assumptions allow for seasonal rental projects for demand and rate as well as maintenance costs. Seasonality is a key input in the analysis as vehicle rentals typically follow tourism trends. There are inputs for owner v. company revenue share as many of the companies hosting vehicle rental, such as Turo, use a revenue share model to cover their services.

Purchase assumptions allow the user to analyze the returns if the vehicle is owned or leased as well as various inputs to achieve a net purchase price including discounts, trade-ins, and capitalized cost reductions. The model allows for analysis of buying a vehicle at a discount and selling at a residual value based on the higher MSRP if owned. If the vehicle is leased a user can make assumptions to purchase the vehicle at the residual buy-out value. The model includes inputs for any leasing fees as well as capitalized cost reduction amounts.

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