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Car Sharing Same as Bed Sharing?

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Zipcar cofounder tells how she described the venture to early doubters.

Sharing cars with people you don’t know is like sharing beds with strangers.

That’s how Robin Chase described it to doubters in the startup days of Zipcar. She cofounded the car-sharing company 15 years ago and once ran it.

Let’s clarify the bed-sharing analogy. She isn’t talking about doing so at the same time. Instead, she cites how hotels work.

“Hotels are in the business of bed sharing,” Chase says at an American Financial Services Assn. auto conference. “I’d tell that to (Zipcar) skeptics in the beginning.”

Zipcar is part of an emerging so-called collaborative economy. Some people praise its coming. Others are less keen, especially those who fret this sharing thing will hurt individual product sales. By the way, the old which-side-do-you-want U.S. hostelry industry booked strangers in the same bed. 

The modern auto industry’s worst nightmare (well, one of them) is Zipcar will zap the strength that’s built from delivering close to 17 million vehicles a year to U.S. consumers who want their own cars.

Zipcar may nip into auto sales, but no automaker will wonder where its leg went. For one thing, Zipcar isn’t for everyone. In fact, it’s for just a few.

“The Zipcar market consists of people who don’t need a car to get to work,” Chase says. So that eliminates, like what, 95% of drivers in most places?

Excess capacity – producing more supply than the market demands or even thinks of wanting – can get automakers in trouble. We’ve seen that.

Zipcar lives off excess capacity of another kind, says Chase who went on to found Buzzcar, a French enterprise that takes the Zipcar business model to the next level. “Excess capacity is my magnet.”

She looks at it this way: A car is the costliest thing you buy, other than a house. "But you only use your car for a couple hours a day. There is so much unused value in that asset.”

I could say the same thing of my bed. I use that only a third of the time, if I’m lucky enough to get a good night’s sleep. But I get her point. “We knew Zipcar could leverage this excess capacity,” she says.

Zipcar owns the cars its clients use for their quick trips. They hop in and drive a few miles. Then the next Zipcar client does likewise. And so on. It’s like a relay. The Internet makes this possible.

Zipcar earns about $26,000 per car, per year, Chase says. She describes her Buzzcar as truly representative of the collaborative economy because “people share other people’s cars across France.”  

Those early Zipcar skeptics in the U.S. predicted a business based on multiple drivers grinding through the same cars would result in some trashed vehicles somewhere down the line.

Wrong, Chase says. People treat the cars pretty well. It’s a different story for rentals. People can abuse those, she says. “A rental company person said somebody once shoved a Big Mac through the air vent of one of their cars.”

That might have been an act of anger aimed at McDonald’s as much as disdain directed at Hertz. Either way, it’s creepy. That’s my take. I’d like to share it with you.

Discuss this Blog Entry 1

on Jun 21, 2016

Car sharing is a profitable business in different countries and to promote this business different organizations are improving the structure of car sharing concept. Hiring a car is definitely charge more; so to divide the money we start car sharing issues. There are several kinds of small and big organizations; those are especially promoting car sharing concepts to earn profits. I hope in near future this service will gain more popularity and earn more profits.
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