After experiencing the great sorrow and joy of the new policy on online car rental and Uber's passage through the door, the melon eating masses are simply worried about the future of DDT, and Cheng Wei, leaving aside accusations of monopolization and the like, bet on the asset-heavy car rental business among the myriad of possible choices, which can be said to be unexpected, but it makes sense.

Drop has been keen on physical combat since the day it was born, but Cheng, who describes himself as a "pragmatic history of war enthusiast," is still accustomed to using the common RTS game of exploding troops, or, in the words of Zeng Ming, chief of staff of Alibaba Group, "intensive bombardment using massive amounts of capital. ", so the drop of August 7 in Shanghai trial operation of the rental car business, rely on is still Verdun or the Somme style of play, there is no time to learn Rommel or Guderian play speed push.

Suddenly the trial operation

Drop car rental project by the No. 1 car team is responsible for, has been secretly developed for a period of time, the so-called sudden, refers to the original drop more concerned about high-frequency products of rapid incremental, dependent on the underlying resources and depth of the operational capacity of the rental car business and not much interest, but the new policy eliminates the gray area, which will force the business model of the drop has to change from light to heavy.

The initial test users of DDT's car rental program came from SMS invitations, and the screening rules were roughly based on big data or heavy users. Since I was lucky enough to be one of DDT's first "super explorers," I naturally had to do some research on the business.

The most intuitive feeling is that the whole product experience is "eaten alive". This has two meanings, the first is that the basic rules have been copied from the system of Shenzhou and Yihi, such as violation processing, basic insurance and deductible, if you have rented a car, you will not be unfamiliar with it, typical of the fetishism.

The front-end experience is a complete replica of the drop special fast car, the advantage of doing so is that the underlying structure **** enjoy, the development of risk is not high, the user to get started quickly, but after all, it is a quick finished product, there are many slots.

It is said that most of the drop car source is to annual rent from the Shanghai small and medium-sized leasing companies, Buick Gl8 this level of vehicle monthly rent of about 5,500 yuan or so, the strange thing is that can be rented Shanghai license plate car is still very little. The reason why we do not use our own cars on a large scale is naturally to control costs, but also shows that this business is still in the exploratory stage.

Drop in Shanghai has no stores, only a few relying on the parking lot of the vehicle distribution points, it pushed door-to-door delivery and pick-up, is to make the process all online, to avoid the offline short board, but in the long run, in the airport, high-speed rail "out of the closet" is still very high possibility.

Order to go is the driver and vehicle double inventory, the system overload will refuse to take orders, drops the rental contract and car inspection link all integrated in the APP, the vehicle appearance of the damage photographed and uploaded, learn is the process of P2P rental car. As for the subsidy is still quite a lot, a rent of 98 yuan of orders, plus an equal amount of coupons, the actual charge of 40 yuan of basic insurance premiums, equivalent to a full waiver, but it is a pity that the settlement of the link is not optimized well.

This model is dissected to be specific, it is the contradiction between experience and wind control.

Drop in the registration link with Sesame Credit's real-name authentication + face recognition, but this is only the primary wind control, orthodox car rental industry is mostly used in the commercial banking system of pre-authorization rather than deposits to control fraudulent cars, at this point drop has no choice but to compromise. Due to the lack of physical stores, can not POS brush pre-authorization, coupled with the central bank in 2014, No. 79 "on the risk of bank card pre-authorization of the incident of the circular" strict control of POS violations of the movement, so the drop in the introduction of ants chanting to do pre-authorization in addition to, but also had to support the savings card, alipay balance to do the deposit, this is mainly because of the vehicle base pre-authorization on the 3,000 yuan, the majority of the chanting users may not have enough amount, but the consequences of the compromise is the settlement system is fragmented, new customers are very easy to blindfold, and the deposit is compared to the normal transaction fees, drop this move not only has the risk of spillover, but also equivalent to additional expenditure costs.

All of this, of course, can not be simply attributed to the product managers of the sloppy, but reflects the drip product strategy on the kind of unique, regardless of the depth of the water dare to dive into the water of the brutal courage.

Why rent a car?

Cheng Wei into the car rental market, the biggest strategic considerations should be the new policy to strengthen the vehicle access thresholds, the individual idle resources that can be utilized by the drop is being accelerated by the policy to disintegrate, and have to rely more on the bargaining power of the car leasing company's support, which will inevitably push up the cost of at the same time, leading to the contraction of the scale of the main business, and it is difficult to realize the *** enjoyment! Economic cost and efficiency of the optimal match. So drop needs a new business to create enough GMV to stabilize the company's valuation, through the policy shock period, at the same time consolidate the cooperation with the car rental company, and outside the original 8 product lines can provide enough incremental space only car rental.

In fact, the use of the traffic entrance advantage of harvesting user dividends has been the effective means of product innovation on the drop, but also consume up to nine rounds of financing and bring the capital market imagination of the usual trick.

Strategy is established, the tactical drops but the sword went sideways.

There are only two types of car rental business in the world: one is Hertz, Enterprise and Avis-budget insisted on hundreds of years and by Shenzhou Rent-A-Car, Yi Hi Rent-A-Car in the domestic development of the B2C model; the other is the U.S. GetAround in 2011 in the *** enjoyment of the economic basis of the creation of P2P car rental. The other is the P2P car rental model created by GetAround in 2011 on the basis of *** enjoyment economy.

DDrop is not taking either of them, out of a compromise route.

First of all, it correctly estimated the shortcomings of P2P car rental, that is, the platform is not involved in the offline operation at all, which leads to the service experience out of control, coupled with overly accommodating the car owner, resulting in too many zombie cars, and the existing source of the car is not active, which affects the platform's efficiency of the collocation. DDT through the whole rental of the car source to effectively control, at the same time, the light on the heavy, exceptionally take over the offline service links, indicating that the difficulty of the car rental business has a clear perception, hope that in the two modes of both their strengths.

The biggest challenge for DDT is that it is not facing a blue ocean, but a mature market with full competition, where there is no old system like the cab industry, which is closed and dependent on policy to survive, and the existing short-term rental and self-driving business is controlled by Shenzhou Rent-A-Car, which had a 31.5% share in 2014, and the U.S.-listed Yihi Rent-A-Car, which has an 8.5% share, and the users who have gone through the market education are more concerned about the stability and reliability of continuous service provision. More concerned about the stability and reliability of the ability to continue to provide services, brand loyalty is very high, so although the drop to do car rental business model urgency and necessity, but the future of a vicious battle is still inevitable.

Drop's strengths and weaknesses

In its previous publicity, DDT emphasized that it was providing a "full online intelligent car rental service" and that "compared with other market players, DDT is committed to becoming an experience-driven, technology-driven ****. Driven, technology-driven *** enjoy self-driving platform". This shows that the drop is fully aware of the lack of resources and systems, deliberately focusing on the sense of technology and online experience, but this is just a public relations tactic, the real advantage of the drop is actually no more than two points:

1, traffic

Nearly 300 million users is the biggest capital of the drop, the user of each line of business from the conveyor has always been a strong point of the expansion of the product of the drop, but This part of the user and rental car business overlap is actually how high and whether it can play a synergistic effect, is still worth observing. DDT was pre-publicity solidified in the image of low price for service, to a certain extent, self-stifled by improving the offline experience to shift to high-end possibilities.

2, subsidies

Transferring subsidies from other product lines to support new business is also an old trick of DDT, but the choice of this time to start the rental car is not the impulse to run, but rather want to find a stable pivot point for the valuation of the market in the rapidly changing environment, so although it is still subsidies first, but it is likely that it will not be the norm.

As for the shortcomings and uncertainties of the drop car rental, there are quite a few.

First of all, although the penetration rate of China's mobile travel market is very low, but it is very difficult for DDT to make incremental increase on this basis, and can only compete for the existing customer base, the latter in the hands of the big car rental companies, which exposes DDT's bottleneck in the resource allocation model.

Drop almost impossible to cooperate with large rental companies, can only pull together scattered small rental car companies, channel efficiency is not high, the control of the source is limited. Previously rumored to have invested in a fast Hi car rental intention to cooperate with the drop, the truth is suspicious, the drop is probably in order to obtain licensing resources, but at least a Hi is a U.S. listed company, they also have door-to-door business, why be willing to be a long-distance rental channel of the drop?

Secondly, the current set-up of DDT car rental is equivalent to a super wholesaler, splitting long rental orders into scattered short rental orders to make money, a cost model that is very bizarre. Although DDT saves money on car purchases, it is burdened with the cost of long term rentals that include depreciation as well as a reasonable profit margin for the contracted rental company, and then trying to make a profit on short term rentals that may still be subsidized how can it be possible.

From the cost structure, Shenzhou and a hi vehicle procurement has a price advantage, coupled with years of business closed loop has begun to consolidate the disposal of used cars, in the existing competitive environment, that is, even if the drop drop RevPAC (average daily revenue per car) to do the second quarter of this year to Shenzhou car rental of 172 yuan or a hi car rental last year, 155 yuan level, is also very difficult to EBITDA (earnings before interest, taxes, depreciation and amortization) to achieve positive values. Earnings Before Interest, Taxes, Depreciation and Amortization) to be positive.

Another shortcoming of DDT compared with Shenzhou and Yihi is its offline operation capability.

Drop has rotated about 50 drivers in Shanghai to support its drop-off and pick-up service, but there's no other way to maintain professionalism in the long term than to recruit a large number of full-time drivers or rely on outsourced chauffeur-driven companies.

The biggest advantage of outsourcing drivers is that they can be recruited to come and fight, but the biggest obstacle is that they are not familiar with the business, which can easily lead to a disjointed experience of the whole service, and the droplets are faced with the toughest trade-offs. In addition, in the delivery and pick-up mode, the vehicle in a particular area to form a distribution center is very necessary to improve operational efficiency, there is no store as a backing of the droplets how to solve the vehicle configuration and scheduling is also a difficult point.

Of course the biggest danger is still wind control.

The previous said, drop car rental wind control almost completely rely on ant gold service, in order to solve the problem of lack of chanting quota also use the deposit to supplement, even if it can get some blacklist from the industry, but also not enough to fundamentally suppress the risk. p2p car rental experience has proved that the biggest loophole of this type of model is that the platform and the owner of the car is inconsistent, in short, for the p2p car rental, the car owner is not the same as the platform. P2P car rental, the car is the owner's personal, for the drop, the car belongs to the rental company. Therefore, once the risk occurs, the P2P company and droplets are not the owner of the vehicle, neither can be recovered on behalf of the vehicle, and only applies to the civil dispute handling procedures, and does not constitute a criminal case.

The owner and the leasing company lost the car, but also with the fraudsters to go to civil lawsuits, this is how big the brain hole.

Future industry dynamics in any case, the impact of the drop car rental is objective. The so-called city gate fire, the fish in the moat, the most likely to die in this wave of thunder and lightning is the moribund P2P car rental, the latter bitter to never get the favor of the capital, but instead in the regulator, orthodox car rental companies and droplets and other new industry under the three mountains, I am afraid that this time, I am afraid of being in a predicament.

P2P car rental to take care of the interests of the owners of the harsh restrictions caused by the closure of information and inequality, not only to pull up the transaction costs, but also dragged down the demand matching rate and response rate, in fact, has disintegrated the platform's aggregation mechanism, coupled with the frequent challenge of some of the **** enjoy the economy's most basic concepts, although the hot blood for a while, but has long since receded from the halo of innovation.

If DDT's car rental is not an impulse, its battle with Shenzhou and Yihi is likely to be protracted, with the final outcome certainly not dependent on purely price factors, but rather on who can maintain operational efficiency within an optimal cost structure, continue to steadily provide high-quality service, and in the process create value for users and continue to improve China's travel ecosystem.

The future variable is whether or not DDT will turn to self-owned fleet construction, which of course, the pros and cons of each other, self-owned fleet can quickly play the flow of the entrance advantage of consolidating the experience of the offline, but the huge consumption of capital for the yet to be IPO and serious losses of the DDT is a burden, in this sense, DDT to launch a large-scale car rental price war is very unlikely, and therefore it is too early to predict how much of an impact DDT will bring to the entire market! It's too early to predict how much of an impact it will have on the entire market.

Drop on the wind has its own business life, it is almost subconscious, straight into a completely new market, which is a bit like the "Guardians of the Galaxy", teasing bear flirting with the tree Grout, "there is danger to pretend to be asleep, talking about the money on the bubble," for the business in the unpredictable market, this is a business instinct. is a business instinct.