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NYT's Car Sharing

NYT's Car Sharing

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Published by LauraNovak

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Published by: LauraNovak on Dec 10, 2009
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12/8/09 1:15 PMSharing to Avoid All the Hassles - New York TimesPage 1 of 4http://www.nytimes.com/2006/10/25/automobiles/autospecial/25share.html?_r=1&oref=slogin
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Peter DaSilva for The New York Times
Reserved parking spot for a Zipcar.
Sharing to Avoid All the Hassles
Peter DaSilvafor The New YorkTimes
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Christina Noren unlocks the Zipcar she reserved online.By LAURA NOVAKPublished: October 25, 2006
San FranciscoCHRISTINA NOR EN’Sdreamcarsits in a rented spacenear her SanFrancisco home. It is a cream colored1963 Studebaker Avanti that she hascoveted since childhood, when onesped past her on the Golden GateBridge. But the Avanti is technically a garage queen,pampered and dormant. So Ms. Noren must rely on a car-sharing service for her daily needs — letting the servicecarry the financial and logistical burdens of owning thecar she uses the most.“I just found it the most convenient way to have a car when and where I need it in thecity,” said Ms. Noren, who lives in North Beach but runs a start-up company in theSouth of Market neighborhood. “I own a fun car that I can’t rely on to get me to ameeting on time. But to me it would be so unnecessary to have a lease on a modern, boring car that is going to lose value and get less interesting by the year.”Car sharing may be a small but growing business, but its environmental good sense andcost-effectiveness are reverberating across America.Car-sharing services provide what experts in the field call “mobility insurance” becausethese businesses provide instant, convenient access to a wide variety of vehicles, many of them hybrids, on a pay-as-you-go basis. An hourly rate can cost about $2 to $13, 
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12/8/09 1:15 PMSharing to Avoid All the Hassles - New York TimesPage 2 of 4http://www.nytimes.com/2006/10/25/automobiles/autospecial/25share.html?_r=1&oref=slogin
depending on the car and time of day. As many as 18 car-sharing services, with nearly 102,000 members and 2,558 vehicles,are operating in 60 American cities. Many are smaller regional services. Two of the bigger companies, Flexcar and Zipcar, overlap in Washington, D.C., and the SanFrancisco Bay Area, where a third agency, City CarShare, is well established. (Zipcar alsoshares the Chicago market with I-GO, which is a partner with Flexcar.) Zipcar is in New  York City, too.Car-sharing operators charge a registration and monthly fee that offers access to a variety of cars for hourly rates. (Some tack on mileage.) The heavy lifting of insurance,repairs, maintenance and even filling the gas tank is left to the service.The programs also spare members the hassle of parking, especially in urban areas wherethe words “parking space” and “nightmare” can be synonymous. Dedicated parkingzones guarantee space and are increasingly located near public-transportation centers.The Bay Area Rapid Transit system currently has 40 spaces reserved for car-sharingservices outside its stations.“It’s well thought out, the rules and online reservations,” Ms. Noren said. “I just know that when I reserve a car, it will be clean and just what I need for the occasion. I canpark it and forget about it.”Car sharing originated in Europe in 1948 but gained popularity in Germany andSwitzerland in the 80’s. By the late 90’s, the first programs were taking shape in America, and now nearly a third of the world’s car-sharing members are here. Member- vehicle ratios, or the number of people who share each car, have risen from 7:1 in 1998to 40:1 in 2005.Dr. Susan Shaheen is the director of the Innovative Mobility Research group and aresearch scientist at theUniversity of California, Berkeley, who focuses on advancedtransportation systems and has conducted surveys on car sharing.“These programs are becoming popular based on three key trends,” Dr. Shaheen said.“The first is ongoing growth in membership and demand for vehicles. The second isinfusion of capital from the private sector. And the third is that there must be moredemand than is being served because we’re seeing multiple operators in several cities.”Customer loyalty can come from something as simple as which company’s car is parkednearest a home or office. Some members choose a provider based on the fleet choices.But the companies welcome the competition, especially in San Francisco, saying thatthree competitors only triple exposure to the ecological and financial benefits of carsharing.“A competitive market challenges everyone to be on top of their game from the productpoint of view and customer service,” said Mark D. Norman, chief executive of Flexcar.“We play hard with Zip and City Car Share in San Francisco. But the market is better forit.”Flexcar was bought last year by the venture capital firm of Stephen M. Case, a founder of  America Online. Mr. Norman declined to state Flexcar’s revenues, but said that thesecond quarter of this year showed a 90 percent growth in revenues. At Zipcar, ScottGriffith, the chief executive, said that revenues would reach $30 million this year, up 100percent from 2005. The company has also raised $30 million in equity in the last two years to further its expansion.
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12/8/09 1:15 PMSharing to Avoid All the Hassles - New York TimesPage 3 of 4http://www.nytimes.com/2006/10/25/automobiles/autospecial/25share.html?_r=1&oref=slogin
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The main force behind the success of car sharing has been that fewer cars on the roadequals less congestion and lower emissions and energy use.Dr. Shaheen said that studies from 1999 to 2005 indicate that 11 to 26 percent of car-sharing participants in the United States sold a personal vehicle after using a service,and 12 to 68 percent postponed or entirely avoided buying a car.“There’s always a temptation to look at the environmental focus,” Mr. Griffith said. “ButI think that’s the sizzle and not the steak. This is a very compelling opportunity to notown a car and have all the convenience at less cost. It makes a lot of sense.”Dr. Shaheen said that the limitations of urban space will eventually force thesecompanies to move beyond their neighborhood niches to partnerships with developersand planned communities outside cities.Zipcar and Flexcar have already begun programs on university campuses. Overlappingmemberships, Dr. Shaheen said, will also provide ease of use between cities, connectingthe dots for users around the country.Despite positive reactions from customers, car-sharing operators have not thought of everything.Michelle Paris of Oakland loved car sharing because a vehicle was parked across thestreet from her house. But she had to cancel her contract and buy a second car.“The biggest issue was the car seat,” Ms. Paris said. “If I wanted to bring my sonanywhere, I had to bring my own car seat. Car sharing targets a pretty narrow market. And as you move in or out of that market, you may not find it valuable to use.”
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