Forget two or three year leases. Daimler will rent you cars by the minute and “is stealing customers from Mazda and Fiat with rentals aimed at drivers ready to forgo auto ownership,” reports Businessweek.
Emboldened by the successes of Zipcar and other short term rental or car sharing ventures, Daimler is test marketing its Car2go service Austin, TX, and Ulm, Germany. Soon to follow: Hamburg, Germany, in early in 2011, and dozens more cities in Europe and North America. Car2go rents Smart cars by the minute. Other carmakers, such as BMW and PSA want to develop similar services.
What makes Car2go different is that you can pick up the car and leave it anywhere within the city’s operating area. GPS tells the central computer where it is. Car2go members pay a one-time registration fee for an access card to rent a car located wherever the last customer parked.
A Frost & Sullivan study sees a shift in people in their 20s and 30s, who see car ownership as a financial drag with little status upside. Car sharing is attractive to younger drivers who grew up with monthly cell-phone bills and other pay-as-you-go services. Add to that the lack and cost of parking in crowded city centers, and you’ve got yourself a nice business. Or a huge problem.
If that concept ever goes mainstream, then carmakers are in big trouble. A car-sharing fleet of 150,000 to 200,000 cars could eventually replace about 1 million consumer-owned vehicles, the Frost & Sullivan study figures. Carmakers face the choice of either catching that trend early or getting gobbled up by it if they snooze.