By on April 10, 2020

With auto manufacturers, dealerships, and insurance agencies scrambling to find a way to retain customers during a global pandemic, now is the season of trying new things. Insurance companies have begun offering refunds on premiums for certain people who can’t afford to pay (and aren’t driving) during the health crisis. Automakers are offering heavy incentives on just about everything, cutting additional breaks for those left unemployed. Dealers are swapping to digital sales models to avoid as much direct contact with buyers as humanly possible while still making a sale.

But what are ride-sharing companies supposed to do?

Zipcar has a few ideas. With ride-hailing services and taxi cabs being viewed by many as mobile germ carriages, you wouldn’t expect shared vehicles to be in demand. Zipcar is making a few changes in a bid to make it all the more appetizing. Rather than relying on its typical hourly (or daily) price rates, it has expanded its Dedicated Zipcar vehicle program for weekly rentals. But that puts the business up against traditional rental firms, which have slashed their prices to an almost comical degree.

Already active, Automotive News reported that the program grew this week in the 10 cities it already serves while launching in 14 more. “The coronavirus crisis has created new needs for our members, especially essential employees, who rely on our convenient on-demand vehicles in urban locations,” Justin Holmes, Zipcar vice president of marketing and public policy, said in a statement.

From Automotive News:

Standard Zipcar services allow users to book a vehicle by the hour or day. Dedicated Zipcar provides Zipcar members exclusive access to keep the same vehicle Monday through Friday.

Dedicated Zipcar rates vary by city and include a monthly membership fee, based on market and class of vehicle, plus a $0.45-per-mile fee. The monthly membership fee ranges from $199 to $349, according to Zipcar. A parking spot, gas and insurance are included.

While this will presumably make a few city dwellers very happy, anybody who plans on doing a lot of driving during the health crisis may be better served by traditional rentals or actually owning a vehicle. Dedicated Zipcar’s mileage fee, combined with membership rates, could easily become more costly than a dirt-cheap rental from a brick-and-motor agency — most of which have swapped over to business models that attempt to minimize customer contact as much as possible.

Your author is currently quarantined in New York City, where Zipcar charges $349 per month for its expanded services… and the auto garage that stores my sedan has this guy who keeps on coughing. I could just as easily snag a week-long rental from Avis, Enterprise, Budget, Fox, Alamo, or Thrifty for under 25 bucks a day — and they all come with unlimited miles. The best standalone deal witnessed thus far was $12 per day for a month-long rental on a Toyota Corolla (or similar). That manager special would probably end up being something less desirable once I arrived at the facility in my hazmat suit, of course.

Fortunately, pricing is low across the board, with only premium models and some minivans averaging over $30 per day.

That’s pretty much the case in all metropolitan areas, especially if they’re under some form of regional quarantine. Prices are down across North America as demand weakens. This makes traditional rentals the better option for carless urbanites who may not need an automobile for the full month but plan on doing a lot of driving while they have it. Meanwhile, Zipcar would be ideal for those who need to avoid mass transit on a daily basis but don’t intend on racking up the miles. For your truly, the tipping point was about 20 miles per day minus the free gas.

Dedicated Zipcar already exists in Baltimore, Boston, Chicago, Washington, D.C., New York, Philadelphia, Portland, San Francisco, Seattle and Toronto. The company said it will shift its national fleet to better serve those markets while also adding Atlanta, Austin, Dallas, Denver, Detroit, Houston, Los Angeles, Miami, Milwaukee, Minneapolis, Pittsburgh, Providence, Sacramento, and San Diego to the mix.

[Image: Roman Tiraspolsky/Shutterstock]

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12 Comments on “Zipcar Expands Options Amid Pandemic, Auto Rental Agencies Cut Prices...”

  • avatar

    But if you do the rental you will need a parking space where your article says the zip car has a dedicated space (somehow). If that is right then paying to park the rental can easily make up and exceed any difference in-rice to the zip (not that I would do either at the moment, but for those who need it…)

  • avatar

    Sorry, I’m not seeing the cheap rentals yet. I’m “essential” and renting weekly. I’m Executive Elite level with National. My contract rate for a midsize is $33/day, plus taxes. Remove my contract (but not my status), and the same days in the large midwest airline hub city, the same car jumps to $93/day, plus taxes. The best I could do was to reserve a compact pickup for $51/day. Even the “last minute specials” for this location are blacked out. The staff at this location told me that they had been renting 700-800 cars a day, and now its under 200. Not gonna lie, my upgrades have gotten better. I’m seeing BMWs frequently, and last week my mid-size became a Range Rover Velar. But I’m not seeing lower prices at all.

    • 0 avatar

      @here4aSammich – have you checked Alamo (or occasionally Enterprise) rates that pull from the same fleet at that location?

      My data points are pre-pandemic, but my experience has been that in locations where ERAC has merged locations/fleets, they avoid discounting National rates and just push the same cars out the same door under the other flags. E.g., I’ve run into this several times at LAX where National is 2x the price of Alamo for the same car class.

  • avatar
    Arthur Dailey

    I have been a Zipcar member for many years. Haven’t used it for at least 2.5. I am in the suburbs of the GTA and they have very few vehicle here.

    However in the GTA if you factor in the cost of parking and the fact that Zipcar covers both fuel and insurance, it may still be much less expensive than a rental and possibly even your own vehicle, if you are paying to park in downtown T.O.

  • avatar

    Unless this turns around soon, Zipcar and the other companies like it are toast, as are a percentage of rental car companies.

    • 0 avatar

      Only fittest will survive this crisis. Repeating every winter. From now on every virus will force to shut down economy and BTW air over LA is crystal clear and there is no traffic, no homeless, none.

    • 0 avatar

      Zipcar is a wholly owned subsidiary of Avis Budget Group, so they probably don’t need to remain profitable in isolation.

      Unless ABG goes under completely, I would expect they’d hold out — the parking spaces Zipcar gives them access to are valuable, and I could see people shifting from transit to car share for a while after this is over. And they’ve pushed aside pretty much all their competition in the US.

  • avatar

    I went by the Thomas and Mack arena a few weeks ago. That’s the UNLV basketball and event arena, located very near McCarran airport. The arena’s parking lot was jammed full of rental cars that were obviously overflowing from the McCarran rental car center.

    This city gets something like 90% of its income by hosting visitors. We’re effectively closed. Don’t know when we might bounce back.

    • 0 avatar

      Nevada might end up needing a bailout by the time this is over.

    • 0 avatar
      Art Vandelay

      It is funny…if you dare to ask “Is it actually worth all this?” You will get flamed and lambasted, but those screaming the loudest have absolutely no idea or plan for the aftermath of this. People will suffer greatly, but not the people screaming I guess…that is all someone else’s problem.

  • avatar

    You can’t put the shale genie back in the bottle. The oil is there and the technology has been invented. We’re going to have cheap oil for a long time to come.

    If an Iranian missile attack on Arabia that knocks out 50% of production capacity barely moves the market, I don’t know what will.

    I invested heavily in various oil industry sub-sectors in early 2014 when it was above $100. I’ll be deducting those losses for the rest of my life.

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