🔗 Share this article What Has Gone So Awry at Zipcar – Is the UK Car-Sharing Sector Dead? A community kitchen in Rotherhithe has been delivering hundreds of prepared dishes weekly for two years to pensioners and vulnerable locals in south London. However, the group's plans face major disruption by the news that they will not have access to New Year’s Day. This organization had relied on Zipcar, the car-sharing company that allowed its fleet of vehicles from the street. The company caused shock across London when it said it would cease its UK operations from 1 January. This means many volunteers will be unable to collect food from the Felix Project, that collects surplus food from supermarkets, cafes and restaurants. Obvious alternatives are less convenient, more expensive, or lack the same convenient access. “It’s going to be affected massively,” said Vimal Pandya, the project's founder. “Personally me and my team are worried about the operational hurdle we will face. Many groups like ours will face difficulties.” “Faced with this reality, they are all worried and thinking: ‘How are we going to carry on?” A Significant Setback for City Vehicle Clubs These volunteers are part of more than half a million people in London who were car club members, now potentially left without convenient access to vehicles, avoiding the burden and cost of ownership. The vast majority of those people were probably with Zipcar, which held a dominant position in the city. The planned closure, subject to consultation with employees, is a big blow to hopes that vehicle clubs in cities could cut the need for owning a car. Yet, some analysts have noted that Zipcar’s exit need not mean the demise for the concept in Britain. The Promise of Shared Mobility Shared vehicle use is prized by many urbanists and green advocates as a way of mitigating the problems linked to vehicle ownership. Most cars sit idle on the side of the road for the vast majority of the time, occupying parking. They also require large CO2 output to produce, and people without a vehicle tend to walk, cycle and take public transport more. That helps urban areas – easing congestion and pollution – and improves public health through increased activity. Understanding the Decline Zipcar was founded in 2000 before being bought by the US car rental group Avis Budget in 2013. Zipcar’s UK revenues barely registered compared with its owner's total earnings, and a loss that reached £11.7m in 2024 gave no reason to continue. The parent company stated the closure is part of a “wider restructuring across our global operations, where we are taking deliberate steps to streamline operations, enhance profitability”. Zipcar’s most recent accounts said revenues had declined as drivers took fewer and shorter trips. “This trend reflect the ongoing impact of the cost-of-living crisis, which is dampening demand for discretionary spending,” it said. London's Unique Hurdles However, industry observers noted that London has specific problems that made it difficult for the company and its rivals to succeed. Inconsistent Rules: With numerous local councils, car-club operators face a mosaic of varying processes and costs that complicate operations. New Costs: The closure coincides with electric cars becoming liable for London’s congestion charge, adding extra expenses. Unequal Parking Fees: Residents in some boroughs pay just £63 for a year’s electric car parking permit. A similar shared vehicle would pay over £1,100 annually, creating a significant barrier. “Our fees should be one-twentieth of a private parking cost,” said Robert Schopen of Co Wheels. “We’re taking cars off the street. We’re putting less polluting cars in their place.” A European Example Other European countries offer models for London to follow. Germany introduced national shared mobility laws in 2017, providing a unified system for parking, support and waivers. Now, the country has several shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK trails at 0.7. “What we see is that shared mobility around the world, particularly on the continent, is expanding,” commented Bharath Devanathan of Invers. He suggested authorities should start to view vehicle clubs as a form of public transport, and integrate it with train and bus stations. He added that one unnamed client was looking at entering the London market: “There will be fill this gap.” What Comes Next? The company’s competitors can roughly be divided into two models: Company-Owned Fleets: Which own or lease their own cars. This includes Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility. Person-to-Person Rentals: Which allow users to hire out their own vehicles via an app – a kind of 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 managing director, 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 establish themselves. In the meantime, more people may choose to buy cars, and many across London will be without a convenient option. For the volunteers in Rotherhithe, the coming weeks will be a scramble to find a solution. The delivery problem caused by Zipcar’s exit highlights the broader impact of its departure on community groups and the future of shared mobility in the UK.