Thursday, May 26, 2005

How much does carsharing in the US cost per month?

North American CSOs use a variety of pricing strategies - some in the classic European system of Time + Distance, some hourly-only with miles included. The rates vary from $4/hr. + mileage to over $10/hr. Some have monthly or annual membership fees, others don't.

Recently I put together a spreadsheet comparing CSO pricing for various amounts of driving each month. For this exercise I assumed an average trip of 4 hours 25 miles (the average trip may now be somewhat less). In the table below I have used the rates from the most advantageous plan that CSO offers for that amount of driving per month, assuming typical weekday usage. Monthly membership fees are included in the monthly cost. If the CSO charges an annual fee, it is pro-rated. (Mea Culpa - If I've gotten the numbers wrong, please let me know and I'll correct 'em. Thanks.)

TWO AVERAGE TRIPS PER MONTH (8 hr. + 50 mi. total)
City Carshare (SF) - $4/hr.+ 44¢/mi. = $64
Community Car (Madison) - 4.50/hr.+45¢/mi. = $74
Philly Carshare - $5.90/hr.+9¢/mi. = $67
I-Go (Chicago) - $6/hr.+ 50¢/mi. = $73
Flexcar Standard - $9/hr. includes unlimited miles = $75
Via-Car 7 hr. prepurchase (Detroit) - $11.43 includes miles = $91
Zipcar Occasional - $8.50/hr. includes 125 miles/day = $72

City Carshare (SF) - $4/hr.+ 44¢/mi. = $226
Community Car Annual (Madison) - $7.75/hr. includes 10 miles/hour = $248
Philly Carshare - $5.90/hr.+ 9¢/mi. = $222
I-Go Standard Plus (Chicago) - $8.50/hr. includes 10 mi./hr. = $272
Flexcar Advantage 25 - $7.00/hr. includes unlimited miles = $227
Via-Car 9 hr. prepurchase (Detroit) - $11.11 includes miles = $355
Zipcar Extra Value - $7.65/hr. includes 125 miles/day = $249

What strikes me is that for all the variation in pricing structures, how closely the costs actually are to each other. Just looking at the rates, one might be tempted to think that $4.50/hr.+45¢/mile would be cheaper than $8.50/hr., but the results below show that when membership fees are added to the mix it may not be. And the other thing is that some companies do it with a single pricing plan while others have various plans and require members to make decisions about the plans. I don't know about you, but I certainly wouldn't copy the cell phone companies in pricing my service!

Some companies favor unbundling costs - membership fees, hours, miles, etc., while others take the opposite approach. Is one better than the other? I provoked a raging debate on the World Carshare discussion a while back on this question, but I think it really depends on your perspective of why you're in the carshare business. What do you think? Please post your comments below, thanks.