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Curtis Hutchinson: The future for car sharing

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Car sharing is starting to build momentum in the fleet world as more OEMs and rental companies roll out business offerings. Curtis Hutchinson reports.

Curtis Hutchinson

Curtis Hutchinson

Car sharing is on the minds of a growing number of motor manufacturers, rental companies and fleets. Not all employees want or need access to a company car 24/7 which is why car sharing is emerging as a feasible alternative for some organisations.

In 2018, Frost and Sullivan researched the car sharing market and forecasted the global car sharing vehicle parc is likely to have expanded 13% year-on-year in 2018 from 983,000 to 1.23m units as shared mobility enters the mainstream.

The research showed how car sharing is set to have a more prominent role in the evolving Mobility as a Service (MaaS) ecosystem whereby the integration of various forms of transport services become increasingly accessible to consumers through smartphone apps.

The process is well underway. In May this year, arch rivals BMW and Daimler agreed a deal to merge their mobility services units (respectively DriveNow and Car2Go) into a 50-50 joint venture encompassing car sharing as well as ride hailing, to challenge the likes of Uber. Frost and Sullivan believes the deal will give the brands a commanding 30% stake of the overall global car sharing market.

Also this year Volkswagen announced the launch of We Share, a dedicated EV car sharing service which will go live in Berlin next spring followed by an international rollout from 2020, starting in major cities across Europe, North America and Asia. Meanwhile Renault has launched a car sharing partnership with Ikea whereby customers can access EV cars and vans 24/7 from stores across France.

The evolution of car sharing is starting to make a more noticeable impression in the corporate sector as a way to offer staff greater mobility options.

“The use of car sharing services has seen a gradual increase since Zipcar first launched its membership-based car sharing company in 2000. There hasn’t been a high demand for car sharing services within the fleet industry up until recently, however this looks set to change over the next few years,” says Joe Howick, chief operating officer at FleetEurope.

“The number of people using car sharing services is expected to triple by 2025. These increases are linked to a much wider choice of employee mobility options, environmental concerns and motorists’ growing desire to use alternative modes of transport. The use of taxis and trains will also be firmly on the radar for businesses as they look to implement total mobility solutions for their workforce.”

The Association of Car Fleet Operators (ACFO) also sees car sharing moving out of its embryonic stage.

“ACFO believes MaaS will become the norm for all employees with corporate mobility managers analysing the total cost of journeys employees make,” says chairman John Pryor.

“A few companies already have systems in place to manage employee use of car sharing and that will grow over the coming years. Businesses are starting to understand the power and advantages that integrated technology can supply in terms of the mobility needs of all employees. ACFO considers mobility to be part of all employees’ benefits package and car share is part of the range of solutions within that envelope,” he adds.

For some businesses, car sharing is being treated as a logical extension of short-term rental policies, traditionally in place to provide staff with mobility on a temporary basis. However, helped by the advent of smartphone-based technology, accessibility has been transformed with the car club concept, initially aimed at private customers but now becoming relevant in the corporate world.

This overlap has been embraced by daily rental providers, many of whom already have the structure in place to provide vehicles from convenient locations in towns and cities around the country.

“Car sharing and car clubs are a huge growth area in business travel and form part of an overall mobility solution. Hourly car clubs are simply another aspect of rental. It is a technology-driven and automated approach that provides additional convenience and 24/7 accessibility,” says Adrian Bewley, assistant vice president of business mobility at Enterprise Rent-A-Car.

“Car sharing will continue to grow over the coming years. Some businesses need a ‘virtual pool car’ fleet of dedicated hourly rental cars and vans parked at their offices, while others can simply use the on-street cars that are also available to the general public. Many fleets use both,” adds Bewley.

A likely future solution is being piloted by several Audi dealers in the UK. The carmaker’s On Demand car sharing service offers vehicles from one hour to 28 days with cars bookable online from as little as 30 minutes’ notice. Customers can then choose to have the car delivered to them, or they can collect and drop off at a dealership.

This mobility model is certain to be scrutinised by other brands who will see the benefits of utilising their national dealer networks to provide a truly local service for a growing number of business customers who do not just want company cars.

 

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Natalie Middleton

Natalie has worked as a fleet journalist for 16 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. As Business Editor, Natalie ensures the group websites and newsletters are updated with the latest news.