Carsharing will go on, but differently
After a period of new market launches and expansion, several carsharing services are downsizing or even discontinuing their operations altogether. What will the carsharing industry of the future look like?
At the end of 2019, Share Now announced it was withdrawing from the North American market and cutting back its operations in Europe. Share Now was created from the merger of the mobility services offered by BMW and Daimler.
Yves Helven, Global Fleet expert, believes Cadillac was not helped by its traditional customer base, which is older and more conservative.
Building a successful carsharing service is no easy feat, he said. “First of all, you need a very customer-friendly, easy to use platform. Secondly, you need good buy-back deals with carmakers. And you need backers with deep pockets, because it’s very hard to make money in this industry.”
Philippe Bismut, Fleet Europe expert and formerly CEO at Arval, agrees. “I don’t know of one carsharing company that is making money, even more so if it’s a free-floating business. To me, the carsharing solutions that are successful are the ones that are based on existing corporate fleets or within a dealership, where some of the costs are already being absorbed elsewhere.”
Pascal Serres, Fleet Europe expert and formerly deputy CEO at ALD, also sees potential in peer-to-peer platforms. “A peer-to-peer business in less expensive in terms of capital as they don’t need to fund the vehicles. Other businesses are much more difficult although programmes backed by OEMs also have their place in the market.”
Mr Helven agrees there is a place in the market for peer-to-peer carsharing, adding we should keep an eye out on what Tesla’s planning to do. “In early 2019, Tesla launched an over-the-air update to prepare all Tesla for carsharing. This feature hasn’t been activated yet but once it is, all Tesla owners will have the option to offer their vehicle on a peer-to-peer carsharing platform. I believe Tesla could attract the right customers for such a service and Tesla could make it work.”
“At a later stage, Tesla could set up its own carsharing service built on this peer-to-peer experience. They might even build a dedicated small city car for this service, in which they could reuse batteries of old Tesla, enabling them to build a true closed ecosytem.”
All three experts agree carsharing is here to stay. Don’t remove it from your MaaS menu yet, but be prepared to change suppliers. “There will be a high turnover in the sector,” concluded Mr Bismut.