Planning to buy a car? Just rent it for Rs 25,000 per month from this startup

Car rentals startup Revv is planning to launch a subscription model for renting cars, a very first in the industry that will permit users to rent cars for just Rs 25,000 a month.

With this subscription plan kicking off at Rs 25,000 per month, Revv will provide a user with a car at their disposition 24×7 for as long as they want, at any given example.

Revv will also permit subscribed users to switch the car model up to twelve times in a year inbetween twelve car models presently available – including Maruti Ciaz, Mahindra XUV, Hyundai i10, Honda Amaze, and Ford Ecosport.

The company will take care of the car maintenance, give roadside assistance, and annual insurance.

The aim, says Revv co-founder Anupam Agarwal, is to substitute car ownership altogether.

“Private car ownership is inefficient. Very first, it could be lounging idle most of the time. 2nd, even if you own a car it’s no assure that you will drive it to a holiday in the mountains,” he adds.

Funded with USD nine million from investors such as Edelweiss and Mahindra Finance, the startup has enhanced its car fleet from twenty five to five hundred cars within two years of its existence.

The company is aiming to offset the leadership position of Zoomcar, which has a fleet of over Trio,000 cars, in next three years.

The company might include door delivery of cars with the fresh subscription plan.

While Revv charges a mandatory fee of Rs three hundred for car home delivery and pick-up, it offers the service on all bookings, be it for an hour. On the other arm, Zoomcar’s home delivery is optional and dependent on the availability of drivers.

Solving the one-way journey problem

The company embarked in two thousand fifteen when ex-McKinsey executives Anupam Agarwal and Karan Jain abandon their jobs to commence a car rentals business.

Zoomcar already had a very first mover advantage as it began in 2013. Contesting in the space also required sophisticated logistics and management expertise of high-value asset like cars.

Other startups – JustRide and Myles – had also adopted the Zoomcar model, with minor tweaks in pricing. Presently, its pricing is inclusive of fuel, while Myles expects users to pay for it over and above the actual charges.

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But Revv did manage to innovate at one very crucial level – one-way trips. There is no player in India that permits you to travel outstation and drop the car at a parking space there.

“I used to rent cars for everything. The need to book a round tour was always a sore point for me. I know many others who would be travelling somewhere for say five days. They couldn’t rent a car because it mandates a round tour,” says Anupam.

Revv needed to do things differently to stand out in a space that already had more than four players vying for attention.

It clearly highlighted the need to introduce home pick-up and delivery services.

Revv, when launched in 2015, also introduced a pricing plan that doesn’t count the distance covered.

“When I rent a car, I hate to look at the kilometres. If that constraint is not there, a rented car more-or-less behaves like a privately wielded car,” says Anupam says.

Zoomcar had introduced such a plan, in select cities, back in 2014.

The company wants to create an practice for users that will resemble wielding a car. The unlimited kilometers plan was a step towards realising that aim. Revv’s subscription model is also a stir in that direction.

Following the hyperlocal model in car rentals

Revv has rejigged the entire hyperlocal parking model that is prevalent today.

In a hyperlocal model, companies have designated parking spaces in every locality – in a vacant plot or at a nearby mall — where the cars are stationed.

Each parking space will have a certain number of cars that caters to that specific locality.

A Zoomcar executive explains that this inventory model makes one-way trips unlikely.

“We can’t suggest one-way trips because it will create an inventory imbalance. It could happen that a parking spot in Bangalore is left with no cars, as they have been transported to another location on a one-way excursion,” Zoomcar’s Paritosh says.

So how does Revv do it? “We designate one driver for every five cars. That one driver can manage three deliveries and three pickups in a day. It’s better than food delivery guys where one person can supply 2-3 packets a day,” Agarwal says.

To make this viable, they equip their delivery executives with a foldable electrified scooter that fits in the boot of every car and becomes a cost-effective, quick and environment-friendly way of getting back to the parking hubs.

The technology backing Revv’s delivery system is designed to manage these deliveries and pickups according to peak times and lean times.

Sometimes, when the system records too many deliveries in a single slot, it will automatically prepone a few deliveries.

“We obviously check with our users if they are ok with taking the delivery a night or a day before. Because it doesn’t matter where the car is parked as long as the user gets their car,” says Anupam.

This reduces the company’s need to acquire a parking space in every locality.

The technology is powered by at least three algorithms developed in-house. Apart from managing the deliveries and pickups, it also measures its own spectacle, manages the inventory, pricing plans, and analyses how much of the fleet is available at a given time.

The algorithm also slots availability according to probable request for long and brief trips.

Today, it manages over Five,000 bookings a month, with over 30,000-40,000 users. About fifty percent of these are repeat customers, claims Anupam.

Clarification: An earlier version of this article mentioned that Revv is planning to launch its annual subscription model for Rs 30,000 and that the company is building a war chest for operational purposes which was based on an interview with our reporter.

The company said that it had updated its plans and will now suggest the subscription at Rs 25,000 monthly, instead of a Rs 30,000 annual subscription, as told to Moneycontrol, earlier. Revv has also clarified that it’s not “in the process of raising any funds”.

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