Not Buying A Car Looks Better By The Minute

Bertel Schmitt
by Bertel Schmitt

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.


Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • Jerseydevil Jerseydevil on Dec 16, 2010

    I use Philly Car Share when i need a car other than my Golf. They have Mini and VW cabrios for a day at the shore, a few BMW's to impress, some lexii, and mostly prius and honda elements, trucks, suv's, all sorts of cars. If I didnt need a car for work, id dump car ownership in a heartbeat and use this service exclusively. Ha, I have like 100 cars at my beck and call! Its great! And I am not a college kid, I'm 60.

  • Ciddyguy Ciddyguy on Dec 16, 2010

    I'm lucky I live in Seattle where we have a decent bus system, a light rail system going in, currently the line to Sea-Tac Airport from Seattle is up and running and originates at the Bus tunnel in Downtown Seattle which is shared by buses. A new Capitol Hill line is under construction as is a short connector line from the bus tunnel to Cap Hill, they reinforced the ground above in anticipation of said construction (it'll be a tunnel, like the Cap hill line will be for much of its length) and I think they are working on the line to Bellevue via I-90 and we also have a regional bus system that ties in with Pierce Transit (Pierce County), Metro (King County), Community Transit (Snohomish County [Everett and environs]) And Kitsap Transit out on the peninsula to make getting around central Puget Sound easier if you don't have a car or can't drive. Seattle is slowly building several street car lines, including the one from downtown to South Lake Union, also invariably known as the S.L.U.T. There is floating a line into First Hill and Capitol Hill as well from downtown and they all augment each other so if one does not want to drive or simply not have to rely on their car for the work commute, they can. That said, we also have the Zip car and the city has designated places for them to park, including 2 next to the Thomas St Park, which is a half block up the hill from where I live. I'd thought of getting a membership with them, but realized with an elderly mother and at least one sister with health issues, needing to get on the road ASAP required that I better have a car on hand, renting or Zip may not work too well under those circumstances. Add to that, I sometimes do multiple errands where Target, Costco etc are on my list and they tend to reside in the northern burbs or in the southern end of Seattle so driving to them is more effective and takes up much less of one's day to accomplish if one drove. Plus, if one rents and wants off street parking, gotta pay extra for it and in Seattle, that's at least $40 extra a month, if not more and doable if one's rent isn't half of one's budget (I once had off street parking, but had to get rid of it when unemployed and don't make enough now to regain it,. some day...). Otherwise, I walk downtown or to my neighborhood stores. I think that the car won't necessarily go away, but rather, it'll take on new priorities as the convenience it offers is too great, but to rely on it for day to day driving may not be where its at in the future, nor for many people so rentals for those who can't afford to own one but need a car every now and then may be a solution along with mass transit, but in the end, a variety of ways to get around may well be the best solution so one can chose which is best for what they have to do on that particular day, rather than be locked into a choice or 2 for all situations as is so often the case now. If poor, live in some inner cities, you are royally screwed as it is now for mass transit in many US cities lack a lot to be desired, if they exist in any real manner to begin with and thus you are forced to live where you don't want to be and can't often get work due to a lack of getting around, a catch 22 situation if you ask me.

  • Honest Joe Honest Joe on Dec 17, 2010

    Can someone please tell me how I can get back the 1 minute & 30 seconds of my life that was wasted watching the linked video above?

  • Techsavvy Techsavvy on Dec 31, 2010

    Please checkout the wikipedia for more P2P carsharing companies ( http://en.wikipedia.org/wiki/Peer-to-peer_car_rental). I agree that in 2011 you will see buying cars should decrease as car sharing will increase. Only those companies who have a better handle on their technology (hardware and software) will survive. There is a challenge to eliminate trust, convenience, security and safety, and a company whose product is targeted to that is JustShareIt (1-855-SHARE-00).

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