Is Zipcar the Amazon of car ownership?

Our man on the spot Robert Dwek quizzes the car-sharing company’s UK boss Mark Walker about its future

It’s been years since I got rid of my car. As a resident of central London, I was tired of hitting traffic jams the minute I left my driveway or of having to go and sit in my parked car with the engine running just to prevent another flat battery. But waving goodbye to my “second home” was inevitably difficult. It’s one thing to embrace public transport in theory and quite another in practice. Still, I adapted soon enough.

And then along came Streetcar, the UK’s first car-sharing company. They owned the cars and, hopefully, left them parked near to your home. You paid only when you used them, for as little as an hour or two at a time. I was a so-called founding member of Streetcar – a great honour I’m sure but, more importantly, a perk that allowed me to be forever immune to the annual fee that was later introduced (still only £50).

After a few years, Streetcar was taken over by Zipcar, its larger and more established US rival. As a Founder Member of Streetcar I was offered a sort of sweetener to convert to Zipcar – about £150 of free rental. The only problem is, it’s going to expire in just over a month and I still haven’t got round to using it. Granted, I now have a toddler who requires a special car seat – something not offered by this kind of service. But even without a baby on board, I’m still not completely sold on this (r)evolutionary new market.

In fact, I have used it just a handful of times over the years. Yet despite not voting with my wallet, I’m convinced that the automotive times are a-changing: in the US, big car rental players like Hertz (Hertz on Demand) and Daimler (Car2Go) are moving into the market. And despite this heavyweight competition, I have a feeling that in Zipcar a brave new brand is being born – a sort of Amazon-ian first-mover.

With that in mind, I put a couple of questions to Zipcar’s UK general manager, Mark Walker:

I live in central London and have noticed numerous ZipVans in recent weeks but not so many Zipcars. How big could the van side could become ?

Mark: We heavily brand our Zipvans and I’m pleased you’ve noticed them! In London, Zipcars actually outnumber Zipvans by a factor of 8-to-1, but the cars are not branded, so our members travel around the city with rather more discretion. We’re working closely with the London Boroughs to see how we might make car club parking bays more readily visible, so local residents and businesses know just how close their local cars are.

The traditional van rental market is extremely large and we’re very happy with the progress Zipvan is making within that market. The combination of their convenient locations, together with the ability to use a van for just a few hours – and only pay for those few hours – is very appealing to our members, be they private individuals moving flat or businesses delivering goods.

We continue to grow the Zipvan business – it’s especially popular with small and medium sized businesses – and it could, indeed, grow to be a very substantial business in its own right. You can expect to see more and more Zipvans.

The US now has a so-called “point to point” player, Car2Go, which seems to operate like London’s Barclays Cycle Hire (“Boris Bikes”). I have to say, both as a Zipcar customer and a Boris Bikes user, that the ability to use a car one-way only does seem very appealing. What are your thoughts on the subject and do you foresee a time when you might offer this kind of service?

The car club/car-sharing category is growing fast and innovating rapidly. The Zipcar model is proven to be convenient and great value for money, especially when compared to car ownership. For the cities where we operate, the Zipcar model is proven to reduce congestion and pollution: every Zipcar takes at least 15 privately owned cars off the streets; Zipcar members drive less, use public transport more and walk/cycle more than car owners.

We are constantly analysing where and how to develop our service for the mutual benefit of members and cities alike. Recently in the US, we invested in Wheelz, a peer-to-peer car sharing company, which opens up some interesting complementary opportunities in that particular segment of the category.

The point-to-point model is also potentially interesting, as it could complement our existing model. Given the types of vehicles used and the per-minute pricing, it lends itself to very short trips, which would otherwise be taken in a taxi, on public transport, by foot or – in London – using a Boris bike. The issue we have yet to fully understand (and where more research is required), is the extent to which point-to-point car-sharing reduces the use of taxis, public transport, walking and shared bicycles; and increases car use in cities. If this is found to be the case, then the model might prove to be contrary to our objectives of reducing congestion and pollution in cities, while providing convenience and value for money for our members. So, while point-to-point might be something we add in the future, it needs to be based on a better understanding of the impact on member behaviour in relation to taxi use etc, congestion and pollution.

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One Response to Is Zipcar the Amazon of car ownership?

  1. It seems like a great idea. I just have a hard time foreseeing a large following in the US. But there certainly is the need for something like it in metro areas.

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