Car-sharing company under fire from governments here and on Peninsula 

click to enlarge FlightCar co-founder Rujul Zaparde says his service is a boon to car owners, but airport regulators and other officials disagree. - ERIC RISBERG/AP FILE PHOTO
  • Eric Risberg/AP file photo
  • FlightCar co-founder Rujul Zaparde says his service is a boon to car owners, but airport regulators and other officials disagree.

Airports are the next major fault line for the sharing economy, and their regulators are already putting up a stout offense against the new spate of apps geared to disrupt the car rental industry. Among them are the South of Market startups Getaround and RelayRides, which entice users by offering cash for otherwise-idle vehicles. But the San Andreas of car-sharing is FlightCar, which already is tangling with local governments.

Backed by a coterie of big-purse financiers, FlightCar lets travelers rent out their cars rather than paying airports to park. Shrewd users can earn $10-$20 a day in passive income by stashing their wheels in the FlightCar parking lot, while also saving on airport parking. FlightCar has booked more than 2,200 San Francisco rentals since February while also incurring a lawsuit from City Attorney Dennis Herrera, who called it "unlawful" for bypassing airport fees and permits.

Undeterred, the startup's three founders — teenage Ivy League dropouts — hatched a plan to extend their model to San Francisco at large. "FlightCar Monthly" will allow San Franciscans to rent their idle cars for guaranteed income of $150-$400 a month.

"We'll bring it back and give you a check on the spot," said the startup's 18-year-old co-founder Rujul Zaparde. To him and his clientele, the service could be a panacea: no more street-sweeping tickets, no having to move your car every eight hours, no jockeying for driveway space.

Herrera claims that FlightCar flouts airport rules that reduce congestion and pollution. Proclaiming itself a technology startup rather than a traditional car rental company, it refuses to pay San Francisco International Airport the 10 percent of all gross profits and the $20-per-rental transaction fee required of competitors like Hertz. That gives it an unfair advantage, Herrera argues, quoting FlightCar's ads: "We have the cheapest rentals. Guaranteed. Prove us wrong and get a free rental."

Zaparde assumes that SFO is just buckling under pressure from rental companies that paid it $94 million last year, according to the suit.

Yet FlightCar may be in for a longer battle than similarly transformative sharing-economy services such as Uber or Airbnb. FlightCar also received multiple complaints from the city of Burlingame, where its parking lot was located. Initially the city reprimanded FlightCar for not providing employees with bathrooms, which the company solved by installing portable bathrooms. Then in June, a city code enforcement officer sent FlightCar a cease-and-desist letter for violating several city zoning regulations.

In response, FlightCar moved to a new, permitted facility in Millbrae, although it retains the Burlingame lot for overflow.

It's unclear how FlightCar's business model will affect transit once it expands to The City. It may, indeed, democratize the American automobile by making it a cheaper and more accessible form of transit. But it might do that at the expense of buses, taxis, bicycles and other services that The City has struggled to promote and protect.

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Wednesday, Aug 31, 2016

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