Budget : 1 million or more
If you have a car that you don’t regularly use, or you have enough cash to buy one, do you know that you can give it out to companies operating cab services at a fee? This is a good way of earning some cash instead of parking the car at home.
Many of these cab companies do not own all the cars you see being used under their names. They get into agreements with car owners to use their cars and pay them some amount of money every month. The agreements vary depending on the company. Some pay on mileage depending on the kilometres covered while others pay a fixed amount per month.
A number of these cab companies get into lucrative contracts with corporates who need their cab services. When such deals come along, many of them end up looking for cars to use since they do not have enough cars.
It is important to have proof of ownership of the vehicle, ideally a log book showing that the car is registered in your name. This will be one of the requirements for some of these companies before you can get into a contract with them.
One thing that is important to note is that many of the companies prefer Toyota. Toyota cars are believed to be robust, durable and suitable for our roads, while at the same time enjoying low maintenance and running costs. This has made them popular and that is why you will see many of them on our roads, different models.
If you have a Toyota which is in a good condition parked somewhere, why not start looking up these companies to compare payment rates and terms and conditions? Even though many prefer Toyota makes, some may also consider other popular makes such as Nissan but this will depend on the company.
Maintenance and service of the car, major and minor, as well as any major breakdowns, will remain your responsibility. Therefore, be open and ready to service your car at any time.
Insuring your car will be your responsibility. With the rampant car theft being witnessed all over the country, it will be in your interest to insure your car comprehensively. Insurance companies will give you various rates but most of them will require a valuation for your vehicle. Rates such as 3% to 4% of the value of the car are common for comprehensive insurance. This is paid per year.
For your own good, your car will be fitted with a tracking system. This will enable you and the cab company to track the movement of the car throughout. We have come across cab companies which have deals with tracking companies whereby cars are fitted with these devices and then deducted from the payments in installments. This saves you from bearing the whole cost of fitting the device all at once, which can be as high as Ksh50,000 or more.
The monthly payments are not standard. Some companies may offer you Ksh40,000 while others offer slightly less or more. The amount may depend on car model and age of the car. The highest amount noted was Ksh60,000 offered for a Toyota Fielder KCD…..
Something to note is that the newer the car, judged by the number plate, not the year of manufacture, the more readily these companies will accept the car. KCC, KCD and KCE Toyota models are very popular at the moment. Of course this will change as more cars are registered.
- Gives regular income without your actual involvement.
- Sometimes the payment may not come as regularly as expected due to late payments and part payments.
- Cost of maintenance may be quite high.
- Your car may be a wreck in a few years.
- Getting a cab company to hire your car may be difficult.
Our advice is that before you get into any deal with these companies, please make a thorough background check including talking to current car owners in the company, if possible. This will enable you make informed decisions.