Tuesday 22 November, 2011. The Green Piece Column.
As Daimler and Europcar continue the expansion of their joint car club venture, Cars2Go into Austria (see story), we wanted to take a look at the rising phenomenon of car clubs.
Daimler is far from the only car maker to start taking an interest in flexible car schemes. Peugeot has its MU scheme, where its customers can swap their car for another or borrow anything from a bicycle to a scooter or van (see story). BMW has teamed with Sixt Car Rental for a car club scheme which is currently running in Munich (which in the future could be expanded across Europe and even come to the UK-see story) and Ford has teamed with ZipCar car club to offer car rental to students at 250 universities across the US (see story).
It’s just car rental isn’t it?
Well yes, and no, actually. It has its roots in the same area, but car clubs arose, in part at least, out of a frustration with traditional car hire and a desire to make it as convenient, quick and flexible as possible, making rental a realistic alternative to car ownership. On the surface, you might expect that the car makers would view this as a threat to their business model, the thought of thousands ditching their privately-owned cars in favour of a flexible car scheme, but the wisest are realising that such schemes offer a great opportunity. For them getting in there early could be best thing they can do.
With inner cities becoming more crowded, fuel prices rising and pressure to reduce our environmental impact, individually owning and parking a vehicle is becoming more of a hassle and more expensive. This is the real threat to car manufacturers’ current business model, who have all feasted on the growing level of car ownership ever since the car was first invented. While car ownership in developing markets such as India and China continues to grow, traditional markets such as those in Europe and North America and parts of Asia, could well start to become more stagnant, driven in part, by a recessive global economy.
As motorists in these stagnant markets consider ways to reduce their expenditure, car clubs start to look particularly interesting.
Just how did it all start?
Car clubs began to take off in the late nineties, but really got into their stride in the noughties, with the likes of ZipCar, StreetCar, Commonwheels, WhizzGo. As the number of car clubs began to grow, traditional car rental giants began to launch their own car club schemes such as Hertz on Demand (formerly known as Connect by Hertz), and WeCar by Enterprise Rent-A-Car; along with a number who linked up with car firms (as we’ve already discussed Sixt and BMW for example).
Car clubs work by allowing members to hire a car from a nearby location, often from a specially designated parking space. The cars can usually be booked just minutes before the user want access to the car, and can be booked via the phone, internet or by text. Usage is usually charged by the hour with an agreed mileage use limit, rather than having a set daily charge like in traditional car hire. The cars are cleaned, maintained and refilled by the company which provides them, making using the cars completely hassle-free. With a pay-as-you-go approach to motoring, its an easy way to control your motoring expenses.
What’s the future for car clubs?
According to independent research it appears that car clubs have a great future, even the Chairman of Ford, Bill Ford (pictured below) recognises that in parts of the world, roads are reaching maximum capacity and we are reaching a stage of global gridlock (see the video in the following post, courtesy of Energy Opportunities) meaning that the industry faces a real challenge over how to keep its customers moving. More flexible transport and better integrated solution along with smaller vehicles like the tiny two-seater electric car concepts we’ve seen an abundance of lately (see Audi and Volkswagen for inspiration) will work alongside a rise in car sharing and car clubbing to prevent inner city areas from becoming completely choked up.
Such is the attraction of car clubs that national charity CarPlus suggests that car club membership is growing at a rate of around 70 per cent per year in the UK. On 1st February 2011, 161,172 members were using 3,055 car club vehicles, based on data collated by the charity. Even with a conservative estimate, if membership sign-up continues at a similar rate, we could be looking at around 2 million members within ten years in the UK.
The savings; here and now
For those considering joining a car club now, then its worth checking out the savings, both environmentally and economically. Carplus –the charity which works to promote the use of car clubs and car sharing solutions- estimates that if you drive less than 6,000 miles per year then a car club could save you up to £3,500 a year. Furthermore, the charity says one car club car replaces around 24.5 private cars; reducing traffic jams, and freeing up parking spaces.
With the average car emitting around 2 tonnes of CO2 a year, car clubs can help significantly cut transport CO2 as well. One club, City Car Club estimates that its cars emit 37 per cent less CO2 than those they replace, as many of its cars are new low emission models or hybrids.
Another figure from the AA says that average car costs its owner £2,749 a year, whereas the same use with car club vehicle would cost £707-that’s a less than a third of the cost of owning your own vehicle.
Now, just where did I leave my car keys, then?
Faye Sunderland.
