Car makers have attempted to tap daily rentals as a revenue stream, but it has thus far failed
A global company with the incredible technical and organisational skill to make cars at scale should be able to monetise a car in more ways than just selling it to a dealer.
This core belief has gripped the car industry for the past decade but so far has met with little success. Alternative forms of ownership in particular have been pursued with a single-mindedness whipped into fever pitch by consultants.
Dull but worthy financing divisions have been rebranded as mobility arms, complete with polished logos, snappy slogans and ambitious profit contribution targets.
The likes of Renault Mobilize, Toyota Kinto and Stellantis Free2Move exemplified the digital-led rebrand of car makers’ direct-to-consumer activities and explored the liminal space between car ownership and daily rental.
But a competence in manufacturing and supply chain proved no match for the idiosyncratic ways of the target urban market. BMW and Mercedes-Benz took an early punt into the car-share market with DriveNow and Car2Go and realised quite quickly that dealing on a city authority level for things as fundamental as parking rights killed the scale model.
A quick tweak to a congestion charge, for example, can blow the business case for an entire city out of the water. (See Zipcar’s case in London.)
BMW and Mercedes reacted by joining forces on car sharing before selling up to Stellantis in 2022.
The ‘ownership versus lease versus subscription versus car share’ equation for urban users is infl uenced on many sides, sometimes at a borough level. New resident parking charges should boost car sharing, but not if they’re included in the hike. Car firms are best out of this. Their primary job is providing good, mostly conventional cars at an affordable price. How they are used is up to users or businesses operating on a level far below their global purview.
