Zipcar has recently purchased the UK car-sharing service Streetcar. Image from Flickr.
In a few large U.S. cities, seeing a parking lot full of Zipcars is becoming more and more common. Soon, drivers in the United Kingdom will have a chance to wave their membership cards to use Zipcars, too. The Cambridge-based company has acquired Streetcar. The combined car-sharing network of Streetcar and Zipcar has about 400,000 members and expands the Zipcar U.K. fleet to 1,770 vehicles.
Zipcar makes global investments
In 2006, Zipcar set up its car-sharing network in London. After that, however, Zipcar has seemed to focus expansion efforts mostly on U.S. and Canadian cities, including purchasing competitor Flexcar. In December of 2009, however, Zipcar purchased a minority stake in Barcelona, Spain based Avancar. The recent announcement of the purchase of Streetcar cements the fact that Zipcar is trying to create a “global” car-sharing network.
Plug-in electrics for car sharing
As a part of the acquiring of Streetcar, Zipcar will be acquiring a plug-in hybrid fleet. Streetcar began testing plug-in Prius cars about a year ago. This builds on the July 2009 Zipcar launch of two all-electric EV pod vehicles in London. About 15 percent of the vehicles in the Zipcar fleet are already hybrids, and the company plans to continue expanding that number.
Rumors of a Zipcar IPO
Zipcar is a 10-year-old company, and will be posting its first quarter of profitability this year. It appears that Zipcar will have an Initial Public Offering by the end of this year, turning the large car-sharing network into a publicly-owned company. Though, originally, Zipcar’s CEO was saying an IPO would not be on the table, he is now saying that the IPO would help investors get their return from Zipcar as well as give the company a chance to expand.
The business model of Zipcar
The model of car-sharing services like Zipcar is fairly simple. Customers pay for a membership to the club – the fee is $50 in the United States – and they are allowed to rent a vehicle by the hour or the day. Zipcar systems are especially effective in cities, where people need a car just for one or two days a week. The rental and membership fees for the vehicle cover insurance, maintainance, and fuel. Enterprise, Hertz, and several other companies are currently working on creating car-sharing systems to compete with Zipcar.