Vehicle sharing is a hot topic in the media. Reports of carsharing services as well as the always popular topic of ride-hailing company Uber and the other companies in that same market, such as Lyft, are on the rise. Vehicle sharing truly is a disruptive force, and it’s helping create a new model for transportation: on-demand mobility. There is an irresistible urge to ask who the winners or losers are in this new landscape, but some assumptions about who is going to be losing are not likely to be proven.
Winners and Losers
One of the most common questions is: Will automakers be the losers thanks to reduced demand for personal vehicles? Navigant Research has projected flattening growth of light duty vehicle (LDV) sales over the long term in certain markets, mainly North America and Europe. But carsharing is a relatively small contributor to this trend. The data on how many personal vehicles are replaced for each vehicle in a carsharing service vary, but estimates from University of California – Berkeley’s Transportation Sustainability Research Center are that each vehicle in a carsharing service replaces four to six new car purchases and postpones up to seven car purchases. Although carsharing memberships have been growing rapidly—Navigant Research estimates that global membership surpassed 3.5 million as of early 2015—the number of vehicles required to serve these members is likely to be well under 100,000. And the impact of these vehicles will be a small percentage of total LDV sales, which Navigant Research estimates will reach 88.8 million in 2015.
Staying in the Game
Automakers are still jumping on the carsharing trend, however. BMW and Daimler have made the biggest commitments so far, with the DriveNow and car2go services, respectively. These two services alone represent over 1 million of the total global carsharing membership. But Ford, Audi, Toyota, and Renault have all been trialing limited carsharing or other vehicle-sharing services. Carsharing may not cut into their vehicles sales significantly, but the overall vehicle-sharing trend does represent a shift in how people in urban environments—a growing percentage of North Americans and Europeans—expect to get around. By offering vehicle-sharing services, automakers can identify their brand with the new world of on-demand mobility. They can also establish brand identity with the users of vehicle sharing, many of whom will become vehicle owners one day. And, they can secure new revenue streams. The vehicle-sharing market will more likely be something that automakers see as complementary to their existing business, not a threat, and they may even be more likely to try to cooperate with the business than to resist it.