Lotte Rental announced on the 23rd that it has signed a strategic cooperation agreement with Shinhan Card to leverage each company’s core competencies to expand the rental business model and support the customer car life.
The two companies agreed to actively utilize the core capabilities and infrastructure each possesses under this contract to generate customer service synergies and expand business models. Through the establishment of a joint business model with Shinhan Card, Lotte Rental will enhance its long-term rental and vehicle maintenance services, ultimately supporting a more convenient and safer car life for numerous drivers. Shinhan Card will provide payment solutions for purchasing rental cars and tailored financial products for customers.
They will also specify new business models utilizing the inherent competitive strengths of each company. Lotte Rental will offer maintenance infrastructure and services to Shinhan Card’s rental car customers.
Through this, they plan to establish a standard domestic car life service that ensures vehicles can be managed with trust. Additionally, they expect to diversify vehicle operations by acquiring some vehicles whose contracts with Shinhan Card have either ended or are about to end for purposes such as used car rental, exports, and auctions. Customers are anticipated to gain wider options for how they utilize vehicles. Shinhan Card will expand embedded finance to enable customers to use financial products on the Lotte Rental platform in the future, enhancing customer convenience by providing financial services on a single platform.
Moreover, Lotte Rental aims to pursue the ‘asset transfer’ of some rental cars held by Shinhan Card. This initiative will begin with around 6,000 vehicles, primarily focusing on those with contracts nearing expiration. This strategy aims to broaden service options for customers while maximizing profits for the company based on Lotte Rental’s top-tier asset management capabilities in the domestic rental car market. Lotte Rental intends to commercialize vehicles returned from Shinhan Card’s long-term rentals to expand its used car long-term rental service called ‘Lotte Rental My Car Save,’ optimize vehicle sales utilizing Lotte Auto Auction’s used car auction and export infrastructure, and allow customers acquired through the transfer to extend their contracts for better service or contract new cars.
A representative from Lotte Rental stated, “This partnership and asset transfer with Shinhan Card is to further specify a financial company’s linked business model utilizing the 38 years of rental industry expertise and complete automotive lifestyle capabilities that Lotte Rental possesses. We will continue to introduce a revenue-generating model devoid of debt based on Lotte Rental’s unique strengths, enhancing customer convenience in car life services and leading the domestic rental industry.”
Meanwhile, Lotte Rental is the only comprehensive rental company in Korea with a full lineup of automotive lifestyle services, including Lotte Rental Cars, Korea’s No.1 rental car brand, car-sharing service Green Car, used car auction Lotte Auto Auction, and Lotte Auto Lease, a commercial vehicle financing company. Earlier, on the 7th, they also signed a strategic cooperation agreement with KB Capital for new business expansion. Lotte Rental plans to continuously strengthen its Non-Asset Based business model through strategic partnerships with financial companies.
Jin Sang-Ik daedusj@autodiary.kr