The first mainstream smartphone-optimized car-sharing service will soon be abandoned. Car2Go announced Wednesday that it will exit the North American market on February 29. Daimler’s company, which is in the process of reinventing itself as part of Share Now after a minority investment in BMW, vaguely attributes the move to “unstable global travel patterns”. It also cites “the increasing complexity of the infrastructure facing North American transportation.”
Originaltitle Carshare app Car2Go announces exit from North American market after defeat in China
Because of this move, the convenient options for peer-to-peer travel will be eliminated in cities in the United States and Canada, which own Car2Go (Chicago, New York, Seattle and Washington, D.C., as well as Montreal and Vancouver). It had withdrawn from Austin, Portland, Denver and Calgary at the end of October.
Its fleet includes Smart Fortwo, Mercedes GLA and CLA sedans, plus cheap pricing (in minutes or hours), and the company’s pre-paid street parking fees make it easy and inexpensive to travel around the city. You open it app, find a nearby car, walk up to the car, unlock it with the app, fasten your seat belt, then drive, pay about 40 cents per minute, and then you can park almost anywhere.
The reporter rented a Smart Fortwo in Washington for the first time and drove from Georgetown to National Park, which felt like stealing a car because he parked at a meter a few blocks from the stadium and didn’t pay.
You don’t have to return the car to where you drive it, which makes Car2Go a good choice, and imagine the following scenarios, such as you need to drag something one way, or take wine to an event. And the old Zipcar can’t do that because it was available on the iPhone, even before Palm Treo.
The service isn’t necessarily cheaper than Uber or Lyft before the price hike, but it’s free from the troubling uncertainty that leaves you unaccounted for the exploitative business model.
Why doesn’t it work?
The fragility of Car2Go’s business is somewhat surprising. In January, the company boasted of “a very successful fiscal year 2018” and said the number of U.S. members rose 20 percent to 1.2 million. There is no minimum monthly or annual fee for this service, so membership must be considered a soft indicator. However, the company did not disclose revenue figures.
The vague explanation in Wednesday’s announcement sparked speculation among onlookers. However, Daimler itself has been under significant pressure as a company, announcing in November that it would cut 10,000 jobs, or 3 per cent of its workforce.
“There are two major barriers to car sharing, namely, other forms of access that reduce vehicle usage and the cost of starting a business and infrastructure,” writes Akshay Anand, executive analyst at Kelley Blue Book. Car2Go may be the latest company to exit the U.S. market, but don’t be surprised if other companies follow suit. “
Anand made the comments in an email from Mark Schirmer, another analyst at KBB’s parent company. Schirmer, who is also a director of Cox’s Automotive, came to a different conclusion.
“For car sharing to work, vehicles have to be in large circulation,” he said. Eventually someone gets the right user experience. “
The journalist’s own use may also be an aspect of Car2Go’s problem. That is, the dependency on Car2Go is too low, and the cost on the credit card is no more than two per month. Recently rented a Smart Fortwo in Washington, D.C., but only drove a few feet, to make room for the back to park your car.
Reporters found out that the city Car2Go would be more useful because there was no car of its own, and capital Bikeshare membership was useless. Every spring, for example, a regular trip to Austin for SXSW is made; two years ago, a reporter rented a car to spend two hours in town interviewing witnesses to the 2018 package bombing.
An observer who studies traffic trends in Washington, D.C., commented that Car2Go had begun to deviate from its initial short-distance driving mission.
Matt Caywood, chief executive of TransitScreen in Washington, D.C., wrote in an e-mail: “You can see that peer-to-peer car-sharing services are moving in the direction of long-distance travel, which usually ends in the fringes of the region. Their marketing has also become more focused on those long journeys and two-way trips. But they have a smaller share of the market as a whole and have to compete with the netcar for the attention of customers. “
His advice to cities that want to keep peer-to-peer car-sharing services like Free2Move is to reconsider the fees you charge them.
He added: “This has never been a level playing field, as some cities charge high licence fees for carpooling (which research shows reduces the demand for parking), but few people charge for vehicles that are called.” “
Privately, however, Car2Go is very important to Caywood. He has been a member of Car2Go since 2011 and said: “On the day we got engaged, I drove Car2Go to Rock Creek Park with my girlfriend, now my. If it goes off the market, I’ll be sad. “