Saturday, April 02, 2011

The difference between car sharing and car rental

In light of several new innovations in shared vehicle services, I think it is useful to review what the essential elements of carsharing are.  And why I consider some services, often referred to as carsharing, are actually car rental.

The simplest description of carsharing that I can come up with is this:
  • Unit pricing that includes fuel and insurance
  • Unattended access to the vehicle at trip start and end
Yes, there are other characteristics of current carsharing services - membership, parking, etc. but they aren't what make carsharing distinctive.   This means that Whipcar, and now Buzzcar, don't meet a key aspect of my definition - unattended access - since both require some sort key exchange.  And for what it's worth, at the present time two current P2P start ups in the US - Getaround and Relayrides appear to have 2 classes of vehicles in the fleet - those with technology and those without.  Of course, this "unattended access" could be easily provided with a simple mechanical lockbox mounted on a wall or post near the vehicle, as a number of carsharing companies have quite successfully employed over the years.

Another innovation that's gotten some press recently is the Peugeot Mu program.  While offering a wide range of vehicle types, it, also, does not meet my definition of true carsharing since (correct me if I'm wrong someone) members have to collect the vehicle keys in person.

Why is this important?

Don't get me wrong, I think car rental serves a useful function and p2p car rental, such as Whipcar, even more so (since it uses existing vehicles more efficiently and provides a gateway into shared vehicles for die-hard "can't pry my hands off the steering wheel" car owners).

The reason I think it's important to make the distinction between carsharing and car rental is because there is a large body of research that demonstrates substantial benefits to individuals, to cities and to the environment when people join and use carsharing - fewer cars, lower VMT, etc.  I would suspect that car rental might be able to demonstrate some of these benefits, although probably to a much smaller degree, but so far these companies have not commissioned any independent studies to validate their impact.  Until the benefits of other service models are quantified, I believe it is important that cities not extend privileges, such as marketing partnership, parking benefits, etc. that have been earned by carsharing.