Rising popularity of car share threatens auto sales

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Car Rental News - 22/02/2010


Car hire usage expected to grow eightfold in North America

David Zhao, a car research analyst from Frost & Sullivan, warned automakers that people using car share service in North America is expected to grow more than eightfold from this year to 2016. He said that the trend is alarming as it could lessen new car sales by at least one million.

According to Zhao’s published auto report, it predicts that people using car share in North America by 2016 will increase to 4.4 million. He further stressed that one shared vehicle could replace 15 personally owned cars.

Such projections are no longer a surprise for AutoShare’s founder and president, Kevin McLaughlin. AutoShare, which operates in Toronto, has about 10,000 car share members.

McLaughlin said that as cities improve the public transport system, as the costs of cars rise, and as people now depend more on iPhones and modern technologies to connect to other people, purchasing a vehicle is becoming a least priority.

Car share service is also believed to lessen carbon emissions. Frost & Sullivan figures show that car share users drive 31 per cent lesser than they would have if they had their own car. Zhao informed that drivers who do not have a vehicle tend to use the car less because they pay per hour.

Regarding other car share companies, Massachusetts-based Zipcar has a fleet of 6,500 vehicles and has members of 350,000 across North America. Meanwhile, Hertz is offering an hourly service called Connect By Hertz in major universities and cities in North America. Moreover, Daimler has launched the Car2Go service in Europe.

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