Is Car-sharing becoming big business?

March 2013

Karen Anderton

Car-sharing has grown in popularity in urban areas across the globe over the past decade and is just one demonstration of the significant potential for servicizing in the mobility sector. Many business models exist, but the overarching feature is that the car is deemed a common resource that can be shared by city dwellers; removing the costs and burdens of car ownership whilst providing the means to make particular trips with very little hassle. At scale the concept reduces the need for parking and alleviates congestion.

According to carsharing.net in 2010, there were more than half a million car-sharers in the USA alone in 2010. Frost and Sullivan state members of car-sharing schemes drive an estimated 31% less than when they owned a personal vehicle – demonstrating the significant potential for fuel savings offered by car-sharing over and above the other benefits.

There is a lot of interest in the concept at the current time, with recent activities amounting to something of a watershed. In January 2013, car rental firm Avis bought the world’s largest (by membership) car-sharing firm Zipcar. And Ford Motor Company announced in early March 2013 that it will be rolling out “Ford2Go” in partnership with Germany’s largest provider of car-sharing, Flinkster. It is the latest in a line of auto company schemes, following BMW and VW, amongst others. With rental and manufacturing industries embracing the importance of car-sharing in their future enterprises, the concept of offering mobility as a service for all shifts emphasis away from selling cars and highlights an increasingly lucrative revenue stream over the coming years, as the purchase of new private vehicles continues to wane.

 Where will car-sharing go next?

Trends are not only leaning toward corporate involvement in car-sharing, but more informal schemes are also springing up. Peer-to-peer car-sharing – whereby car owners provide other individuals’ access to their private vehicle when not in use – has also been increasing in popularity since 2010 or thereabouts. Lift-sharing and carpooling have both been a prominent feature of community mobility for decades, based on common destination, but have only ever been feasible on a micro, ad-hoc scale. Yet facilitated by the rise of the internet and social sharing platforms, informal, private car-sharing has a much larger potential to alter driver behaviour and raises important questions about the diminishing need for ‘ownership’ of cars, and indeed other products, in today’s increasingly networked society. For this reason, car-sharing – both formalised, corporate-owned membership-based offerings, and socially-configured community schemes – will be a fascinating demonstration of how servicizing has significant potential to shift the mobility sector towards greater resource efficiency.

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