A guide to buying cars
Market analysis and defining your portfolio
Before you jump ahead and buy another car to list on Turo, ensure you're equipped with essential insights to make a well-informed choice.
Know your market
First things first: figure out who your guests are and what their typical trips are likely to be to maximise your bookings. For instance, you might notice demand for small, easy-to-park cars if you're based in a city. If you’re located in a gateway to the Great Outdoors, rugged SUVs and 4X4s may suit your market.
Top tips
- Talk to your guests to find out what they want.
- Browse Turo to see what other types of cars are listed in your area.
Define your portfolio strategy
Successful hosts often create a portfolio of similar cars, such as a collection of everyday vehicles, a line-up of SUVs, or commit to a single manufacturer so you become a pro in a particular brand. Exactly how this looks varies from host to host. This strategy allows you to attract guests with similar preferences and establish a clear market position.
On the other hand, some hosts have a diverse portfolio to cater to different needs and seasons.
Aligning your strategy to your personal car preferences is fine, too.
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Figuring out your portfolio strategy
PLAYPLAYPLAYTop tips
- To zero in on your portfolio strategy, swap advice with other hosts and don’t be afraid to test and change your strategy.
- Identify gaps in the types of cars offered in your area, but ask yourself if there’s sufficient demand for them.
- Stand out! Distinctive vehicles get more clicks and more potential bookings.
- Think about the unique value proposition, competitive advantage, and the level of service you want to offer your guests.
- Sticking with one manufacturer means you get to know the second-hand market of a model market well and can simplify servicing and sourcing parts. Remember that your strategy can change based on what works for you and your market.
Car selection
Once you’ve considered your portfolio strategy and the type of guest you'd like to target, it's time to think about exact makes and models.
Dive into the details
Research all the costs for the vehicle you have in mind and factor these into your budget and decision. Work out the insurance, servicing, and maintenance costs. Remember to factor in cleaning time and costs, too.
Top tips
- Power Hosts often favour used cars from Japanese or German manufacturers because of their renowned reliability and lower depreciation rates.
- Automatic transmission appeals to a broader range of guests, including those from international markets.
- EV or hybrid models attract eco-conscious guests and those looking to take an EV on an extended test drive.
- Consider seasonal demand. Convertibles perform well in the summer, and all-wheel-drive vehicles are typically searched for in the winter.
Crunch the numbers
Armed with your market data and research, analyse the figures to work out the upfront costs and determine how vehicles like the one you’re considering fare on Turo. Consider your past experiences on Turo and booked trip trends to help inform your analysis.
Car acquisition
Once you know what you're shopping for, consider whether you'll buy brand new or used. Many hosts building a business on Turo prefer used cars that have already had the most significant depreciation hit but still have the look and feel of a new vehicle.
Buying new
Some hosts choose new vehicles to charge higher prices. You could also benefit from reduced maintenance and take advantage of dealership warranties. Buying new cars means you may be one of the first hosts on Turo to offer a newly released model, which can help attract some initial buzz.
Top tips
- Shop around. Use tools like Carwow to compare the best offers from different dealers.
- Negotiate! Getting the lowest possible price will maximise your return on investment on Turo.
- Add extras that make cleaning easier, such as all-weather mats.
Buying used
Although older cars may be less expensive initially, they often require more maintenance, which can add up over time. When buying a used model, it's best to look for a reasonably aged and well-maintained vehicle with an optimal balance between price and reliability.
Top tips
- Check for a complete service history. Choosing cars with one or two prior owners may indicate the vehicle has been maintained well.
- Whenever available, select a car with a dealer that offers a warranty.
- Remember to check Turo’s milage limits.
- Opt for a make and model with a proven track record for dependability and longevity, which will lead to happier guests, positive reviews, and fewer long-term issues.
Buying routes
AutoTrader is a favourite platform for hosts to acquire cars, and there are others, including Carwow, and Cazoo. Others favour independent used-car dealers, or source used cars directly through manufacturer dealerships.
Top tips
- If you buy at an auction, make sure you know exactly how to thoroughly check a car before purchase.
- If you buy second-hand from a private seller, check the car’s history using a tool like the AA Car Check.
- Build a relationship with a trusted local dealer who can give you a heads-up when new stock arrives.
- Turo’s busiest season is summer, so getting your new portfolio ready in the spring means you can get some great reviews on the listing before demand spikes.
- Before you commit to buying, double-check that it meets all of Turo’s requirements to be sure it’s eligible to be listed.
Financials
Maybe you're investing Turo gains into a new car to build your portfolio and meet your business goals. But if you need help financing your growing business, make sure you choose a financing option that's competitive and affordable.
Car Financing
When you buy a car directly from a dealership, they may offer financing options. It's crucial to compare rates and terms with other lenders to ensure you get the best deal.
Top tips
- Avoid locking into long-term financing if you’re testing a new portfolio strategy.
- Online platforms, such as AutoTrader and Carwow, offer car financing. You may also be able to trade in another vehicle if that works for your portfolio strategy.
- Remember to compare the online financing offer with other finance options.
Leasing
When you lease a car, you pay for the decrease in value of the vehicle during the lease period, which typically lasts from two to four years. Once the lease is up, you can either return the car or buy it at its residual value. Leasing may be suitable if you enjoy driving new cars and want consistent and predictable monthly payments.
Top tips
- Some lease agreements do not permit car sharing so be sure and read all the details.
- Terminating a lease isn’t always possible, so be sure you want to commit.
Risk management and planning
Know what you'll do if things don't go to plan. And always have one eye on your future growth.
Review, review, review
Power Hosts regularly check the current value of their vehicles by monitoring their cars on Autotrader and motorway.com to determine the cars’ depreciation. This helps decide if it’s worth selling and replacing with a different model or if it’s still a wise and profitable choice.
Hatch a Plan B
Have an exit strategy so you know exactly what you’ll do if a car isn’t performing on Turo as you’d hoped or based on a service report. You can also pre-empt future problems by selling a vehicle once it reaches a particular age or mileage.
Plan for growth
Success breeds success on Turo, and once you’ve added a car or two to your portfolio, many accomplished hosts continue to grow their businesses by re-investing their returns into additional vehicles.
Top tips
- Join community events designed for hosts to exchange tips and meet the Turo team for advice on growing your business.