Dubai by-the-minute car rental company helping to solve city’s first and last mile transport problem
When Hasib Khan set up Aimex Rent A Car three years ago, he did not want it to get lost among the hundreds of car rental companies in Dubai.
So two years after launching he converted it into UDrive, a rental by-the-minute concept allowing short-term hires. While the business hit a major roadblock at first, it is now speeding ahead.
UDrive is Mr Khan’s eighth business in a portfolio spanning three countries – the UAE, Afghanistan and Germany - and sectors from logistics and transportation to real estate, construction and food and beverages. The Kabul-born German, 26, grew up in Hamburg and launched his first business, a car dealership, at just 16.
The idea for Aimex Rent A Car came when an interviewee demanded a company car and Mr Khan realised it would cost half as much to buy a car than lease one at Dh1,800 a month.
But in an already saturated market, he had higher hopes for the business.
“We were just a nobody in a market of hundreds of companies that were much bigger than us and much better than us,” he says. “But my idea, from the very beginning, was to develop something smarter.”
That smarter solution was UDrive. But just one week after pivoting to offer rental-by-the-minute last March, Mr Khan faced a challenge. At the time, he discovered, car hire by anything other than the day was illegal – and he had to revert to the standard by-the-day hire.
However, by September a resolution allowing car rental by the hour and minute was passed. Shortly after, the Roads and Transport Authority (RTA) put out an invite to tender on its hourly car rental project as part of its plan to boost public transport.
UDrive and another car hire firm, Ekar, won the contracts, and UDrive was back on the clock in January. Mr Khan would not divulge the costs of the contract.
The RTA hopes hourly leasing will reduce car ownership by helping to solve the “first and last mile” problem from Dubai’s public transport stops such as metro, bus and tram stations. Until now, the only other solutions have been feeder buses and taxis – or on foot, often in searing heat.
Bill Carter, deputy general manager of Autodata Middle East agrees, saying the concept will attract those looking to save on car costs.
“It really appeals to those people who need to cover the last few kilometres from a metro or bus station, or simply need to get to a meeting where public transport does not reach,” he adds.
Short-term car rental is a growing part of the sharing economy trend. German Car2go, which claims to be the world’s biggest car-sharing company, has over two million members in North America, Europe and China. Peer-to-peer car rental is also gaining traction as individuals rent their own cars out instead of leaving them on the driveway.
There are also environmental benefits to car sharing. In a three-year study of Car2go’s 14,000 vehicles, UC Berkeley’s Transportation Sustainability Research Center found that each vehicle used for car sharing could remove up to 11 cars from the streets and cut greenhouse gas emissions by nearly 13 tonnes a year.
UDrive has a licence for 100 cars and five spares for accidents or breakdowns. It owns its fleet of green-and-white Nissan Tiidas, Peugeot 208s and Toyota Yarises outright.
About 150 trips a day are currently being made by its 2,000-strong registered user base, with 45 designated spots around Dubai to pick up your car from. If you drop the vehicle at the same spot (known as “point to point”) it costs 40 fils a minute; drop it elsewhere (a one-way trip) and it costs 50 fils a minute. That includes fuel, insurance and most parking, although not Salik congestion charges or fines.
UDrive offers a keyless solution: first you register by uploading ID, driving licence, credit card details and a photo – whether a resident or tourist. Once reserved, you have 15 minutes to get to the car. You then unlock it using the UDrive app and open the glove box and type in a Pin number to start the car. When you have finished your journey, just shut the car door and walk away.
Ekar, which formally launched in January, charges Dh6 to Dh7.5 per 15 minutes – the same as UDrive, but in quarter-hour blocks rather than per minute. Both companies have recently waived their Dh20 membership fees.
The RTA also plans a mobile app this year to allow users to rent cars from either company. Rental is capped at six hours per day.
UDrive may add electric vehicles in the future and Mr Khan hopes to expand the business to Sharjah, Abu Dhabi, Riyadh and Doha.
So does Mr Khan use UDrive himself? You’ll often find a UDrive outside his home – but he also drives a Range Rover.
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Updated: March 19, 2017 04:00 AM