Automakers, both domestic and come-from-away, all want you to do the next best thing if your meager funds aren’t enough to get you into a showroom: borrow a car.
Ride-sharing services provide mainly urban dwellers with the car they so desperately crave, without the years of payments or need to find permanent parking. And, if an automaker partners up with a service provider — or creates its own — there’s still money flowing back to the offices of Big Auto. Win-win, no?
The growing trend is hard to ignore, and it means that automakers — already new to the game — face ever greater competition, even from unlikely sources. The latest company to offer a ride-sharing service isn’t a manufacturer at all. It’s the American Automobile Association.
Through its A3 Ventures innovation lab, AAA has created a ride-sharing startup called Gig. Ready to launch as a pilot project in the San Francisco area this month, the service capitalizes on the trend — one that the automotive nonprofit feels will soon become a much larger part of the transportation picture. After all, when you’re a tech-focused Millennial paying thousands of dollars a month to live in a shoebox in a major urban center, who has the money (or space) for a car?
Unlike other services, this one lets you be as spontaneous and lazy as you want. The app lets you locate a nearby car using your phone, unlocks it, and off you go. When you’re through with the vehicle, simply leave it in a parking space in the right area.
“Unlike traditional station-based models where you go out shopping for the day and you’re paying for the car while you’re not using it, while it’s sitting there parked, with the one-way model, you can take a car, drive to where you’re going, end your trip, and not have to pay for a vehicle while you’re doing whatever you’re doing,” Mike Hetke, executive vice president and chief innovation officer at AAA Northern California, Nevada, and Utah, told Fast Company. “And then grab a different car to drive back home.”
The cities of Oakland and Berkeley have agreed to let Gig cars park on city streets, even in some metered spots, as studies show that a ride-sharing vehicle is capable of removing up to 11 vehicles from the road.
In choosing a vehicle to serve as the go-to runabout, AAA followed the prevailing social winds and went the green route — a decision that undoubtedly helped win over the municipal government. All 250 Gig cars in the Bay area are Toyota Prius C models.
Given that this is a pilot project, it could expand to other areas. Of course, that’s assuming local governments buy into the concept.
“You can’t do this on your own,” said Hetke. “It requires participation and partnership with the municipalities to create the super permits that enable this model. And so you have to convince municipalities, and there’s a number of competing factors for municipalities to consider.”