🔗 Share this article What Has Gone Wrong at Zipcar – and the UK Vehicle-Sharing Market Dead? The volunteer food project in Rotherhithe has been delivering hundreds of cooked meals each week for two years to elderly residents and needy locals in south London. However, their operations have been thrown into disarray by the news that they will not have cars and vans on New Year’s Day. This organization depended on Zipcar, the car-sharing company that allowed its fleet of vehicles from the street. It caused shock through the capital when it declared it would cease its UK business from 1 January. It will mean many volunteers cannot pick up supplies from a major food charity, that collects excess produce from supermarkets, cafes and restaurants. Obvious alternatives are less convenient, more expensive, or do not offer the same convenient access. “The impact will be massively,” said Vimal Pandya, the community kitchen’s founder. “Personally me and my team are worried about the logistical challenge we will face. Many groups like ours are going to struggle.” “Knowing the reality, everyone is concerned and thinking: ‘How will we continue?’” A Major Blow for Urban Car-Sharing These volunteers are among more than half a million people in London who were car club members, now potentially left without easy use to vehicles, without the hassle and cost of ownership. Most of those people were likely with Zipcar, which held a dominant position in the city. The planned closure, pending consultation with employees, is a serious setback to hopes that car sharing in cities could cut the need for private vehicle ownership. Yet, some experts also suggested that Zipcar’s departure need not spell the end for the concept in Britain. The Promise of Shared Mobility Car sharing is prized by many urbanists and environmentalists as a way of mitigating the problems associated with vehicle ownership. Typically, vehicles sit idle on the street for the vast majority of the time, using up space. They also require large CO2 output to produce, and people who do not own cars tend to walk, cycle and take transit more. That helps urban areas – easing congestion and pollution – and improves public health through increased activity. What Went Wrong? Zipcar was founded in 2000 before its acquisition by the US car rental group Avis Budget in 2013. Zipcar’s UK revenues barely registered compared with its parent company's total earnings, and a loss that grew to £11.7m in 2024 gave no reason to continue. The parent company stated the closure is part of a “broader transformation across our international business, where we are taking targeted actions to simplify processes, enhance profitability”. Its latest financial reports noted revenues had fallen as drivers took less frequent, shorter trips. “This trend reflect the continuing effect of the economic squeeze, which is dampening demand for discretionary spending,” it said. The Capital's Specific Hurdles Yet, several experts noted that London has specific problems that made it difficult for the sector to succeed. Patchwork Policies: With numerous local councils, car-club operators face a patchwork of different procedures and prices that complicate operations. New Costs: The closure comes as electric cars becoming liable for London’s congestion charge, adding unavoidable costs. Parking Permit Disparity: Locals in some boroughs pay as little as £63 for a annual electric car parking permit. A similar shared vehicle would pay over £1,100 annually, creating a major disincentive. “We should literally be charged one-twentieth of a resident’s permit,” said Robert Schopen of Co Wheels. “We remove vehicles. We’re putting less polluting cars in their place.” A European Example Nations in Europe offer models for London to follow. Germany enacted national car-sharing legislation in 2017, providing a unified system for parking, subsidies and waivers. Now, the country has 5.4 shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK lags behind at 0.7. “What we see is that shared mobility around the world, especially in Europe, is expanding,” commented Bharath Devanathan of Invers. Devanathan said authorities should start to treat car sharing as a form of public transport, and integrate it with train and bus stations. He added that a potential operator was looking at entering the London market: “Operators will fill this gap.” What Comes Next? Other players can roughly be divided into two camps: Fleet Operators: Which own or lease their own cars. Examples Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility. Peer-to-Peer Services: Which allow users to rent out their own vehicles via an app – similar to Airbnb for cars. Players include Britain’s Hiyacar and the US’s Getaround and Turo. Turo, a US-headquartered peer-to-peer platform, is assessing the UK gap. Rory Brimmer, its UK head, said there was a “big opportunity” to win more users. “A space exists that is going to need to be filled, because London still needs to move,” Brimmer said. However, it could take a while for other players to build momentum. For now, more people may feel forced to buy cars, and others across London will be left without access. For the volunteers in Rotherhithe, the next month will be a scramble to find a solution. The delivery problem caused by Zipcar’s exit underscores the broader impact of its departure on community groups and the future of car-sharing in the UK.