Major car sharing schemes close across Europe

The future of car sharing clubs has been dealt a blow by the announcement of closures to three major schemes run by large operators.

Zipcar, owned by Avis Budget, and Zity, owned by Renault’s Mobilize, look set to close their free-floating car sharing operations in the UK, Milan and Madrid respectively.

Car sharing or car clubs originally looked as if they would play a key role in urban mobility as a service schemes, supplementing public transport when people needed a car or van for either business or private journeys.

Flexible hire
The clubs enabled customers to hire a vehicle by the minute, hour or day, and to leave it at the end of the hire period in either a public or designated parking bay.

Arthur Kay, a Professor at UCL and Board Member of Transport for London, said car sharing was one of the few tools that shifted mobility from ownership to access.

“Cars are expensive capital assets that sit idle for around 95% of the time. We pay for depreciation, insurance, parking, and tax, even when the car is unused. Access-based models like Zipcar reverse the incentives. You pay for the journeys you take, not the capacity you rarely use,” he said.

$500 million
Avis Budget Group bought Zipcar for about $500 million in 2013, and continues to run Zipcar in the US and Canada.

Over 12,000 companies had a UK Zipcar business account, and the company had 650,000 registered customers for its UK fleet of more than 3,000 cars and vans, including over 1,000 electric vehicles.

A statement on Zipcar’s website said the company: “proposes to cease operations in the UK.”

Its decision is subject to formal consultation with affected employees, and an Avis Budget Group spokesperson said: “This proposal is part of a broader transformation across our international business, where we are taking deliberate steps to streamline operations, improve returns, and position the company for long-term sustainability and growth.”

Car clubs reduce car ownership

Richard Dilks, chief executive of CoMoUK, the UK’s national shared transport charity, said that as the largest car sharing company in the UK, Zipcar was making a major contribution to reducing car ownership and mileage, which cuts traffic congestion and improves air quality.

“It’s particularly concerning that so many Zipcar users are now considering buying their own vehicles, as they simply don’t see any alternative service with the same ease and flexibility,” he said.

“Every car club vehicle replaces 31 private cars in London, freeing up space and making the capital’s streets less clogged and more pleasant for everyone.”

Rory Brimmer, managing director of Turo, the peer-to-peer car sharing firm, said Zipcar’s departure from the UK highlights the challenges faced by car clubs in the UK, particularly for the traditional fleet models.

“It’s clear that more support is needed from government to enable a future that has genuine alternatives to car ownership,” he said.

Enterprise Car Club commitment

Enterprise Car Club, which operates a fleet of more than 1,300 vehicles in 220 UK towns and cities, said it would continue to seek opportunities to expand its network and provide customers with alternative transport by the hour or day.

Dan Gursel, Head of Enterprise Car Club UK, said the firm: “remains committed to delivering sustainable, cost-effective and convenient shared mobility to consumers and businesses across the UK.”

Zity exits Milan and Madrid

A statement from Renault Group said: “Some activities developed by Mobilize Beyond Automotive are discontinued, either because they have limited profitability prospects or because they do not directly serve the Group’s strategic priorities.”