While much of this technology is still only beginning to penetrate the market, its growth demonstrates its virility.
While car sharing only represents $400 million market , compared to the $24 billion traditional car rental market, according to a study from the Transportation Sustainability Research Center, further research also shows that membership has grown an average of 133% each year between 2010 and 2014. Another study of Car2go members suggests that the service is, on net, reducing the number of privately owned vehicles among their regular users: 2-5% sold their vehicle and 7-10% did not purchase a vehicle because Car2go satisfied their needs.
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In fact, if you drive 9,700 kilometres or less a year, it’s probably cheaper to share than to own, and the payoff is impressive. Research showed that households saved $154 to $435 (USD) per month after joining a car-sharing service.
While it’s still early days, it’s clear that car sharing and C/AVs are here to stay. This technology has buy-in from major players from both the automobile and technology industries. The debate is about how soon – not if – the technology will be mainstream.
The End of the Two Car Family
Jack Kerouac inspired a generation to take to the open road. Cars represent freedom, letting you break away from the hustle and bustle of busy city streets, out onto the open road with the wind in your hair. We have a love affair with our automobiles. The question then becomes, how our emotional attachment to our cars will translate to the sharing economy and the advent of self-driving vehicles?
While global car sales are still breaking records in many places across the world, experts all say that this growth is quickly levelling off. There are many reasons for this – rising gas prices, the expense of owning a car, to name a few – and now in many urban centers car and ride sharing options are making this expense unnecessary. You can use a car when you need it, on demand, without having to worry about the oil changes, tire changes, parking, etc, that comes with traditional car ownership.
The big car manufacturers agree. BMW has started DriveNow, which lets buyers of its Mini brand car-share through the platform, offering their car to borrowers when they are not using it. Ford, meanwhile, is trying a similar tactic by pairing with car-sharing platform Getaround, which uses a similar model.
The research suggests that the first big shift to come will be the end of the traditional two-car per family model of ownership. Instead, families will shift to a car and a car-sharing membership. “A change in mindsets is happening, especially in urban centers,” says Alexandre Taillefer, Managing Partner, XPND Capital in Montreal. He thinks that the prestige people used to prescribe to owning lots of cars is waning, and that a rental-by-usage system is what’s on the horizon.
The logic behind these predictions becomes clear when you look at the statistics on how people are currently using ride-sharing in their daily lives. For example, Lyft’s data shows that 25% of the trips on their service are either to or from a public transit station, showing how people are already adopting an intermodal approach to their commutes. It demonstrates the potential of rideshare and transport network companies to provide convenient, cost-effective first-mile/last-mile solutions that support transit ridership.