Car Sharing: The Transportation Alternative

Category: Gas, SavingsTags: car sharing, gas costs, public transportation, transportation, zipcar

With the record-high gas prices, many drivers are looking for alternative ways to reduce the cost of vehicle ownership. While opting to use public transit or bicycling are great ways to save money, sometimes you just need a car. Shopping at the local mega-store, taking your pit bull to the vet and going on a date are all trips better suited for a private car than a public bus.
The emergence of car share organizations, both for-profits and non-profits, has offered drivers an alternative to both private car ownership and public transit. These car share companies all tout the benefits of having access to a car without the costs and responsibility of actually owning one. The logic is simple – why own a car full-time when you only drive it part-time?
What Is Car Sharing?
In general, car sharing is an alternative to owning a personal car, with availability restricted to larger urban centers. Drivers register with a car share company and usually paying a membership fee. They then choose from various hourly or daily rate plans, depending on location and frequency of use. With all the companies we reviewed, the fees included gas, insurance, and reserved parking. Some plans include a set amount of miles, with others billed on combined time-plus-miles driven models. All companies charge a premium for weekend use and some offer deeply discounted rates for late night bookings.
Cost of Car Ownership
In their 2010 annual “Your Driving Costs” report, the American Automobile Association estimated the annual price of owning a medium sedan (such as a Ford Fusion or Honda Accord) is $5,841. This is based on driving 15,000 miles per year at the 2009 average gas price of $2.0603 per gallon and does not include parking charges. For minivan owners, the annual cost jumps to $6,404 and SUV drivers pay an average of $7,738 per year, or 22.31 cents for each mile they drive.
In comparison, a member at City Car Share (a San Francisco non-profit company) can make a weekly, 24-hour booking for a full year at the base cost of $2,496.00 including gas, insurance, maintenance and parking. If they drive that car 300 miles per week, or 15,600 miles annually, their mileage charge is $1,560. The total annual cost of using a car share is about $4,056 – $1,785 less than owning a similar vehicle.
Car Sharing Costs
According to I-GO, a Chicago non-profit car share company, members spend about $2,500 annually on transportation, a savings of over 50% in comparison to above estimate. They also claim that nearly half of their new members who owned cars when they joined sold their personal vehicles within six months of participating in the I-GO program.
Other potential savings for car share users is the cost of parking, which is over $250 per month in some urban areas. Because most organizations offer a variety of different vehicles like minivans, pickup trucks, and convertibles to their members, some users opt to own a small compact car and use the car share service when they need a larger vehicle.
Car Share Companies
City Car Share

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This San Francisco non-profit has an extensive fleet placed throughout Berkley, Oakland and San Francisco, including a convertible red Mini Cooper, wheelchair-accessible van and an all-wheel drive Subaru wagon. They offer 3 individual/household membership options as well as 3 business/non-profit plans.
Rates here vary between $0-$6/hr plus $0.35/mile, with average members spending about $6.75/hr including mileage, gas, maintenance and insurance. For extended weekday trips, members pay a 24-hour rate of $48 plus $0.10/mile (weekend rates are $52 per 24 hour booking).

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Billed as “Neighbor-to-Neighbor Car Sharing”, this California start-up has brought a new twist to the car share concept. By enlisting private vehicle owners to place personal cars into a rental pool, RelayRides lets “borrowers” book and use these independently-owned vehicles on an hourly, daily, or weekly basis. Like other similar organizations, all the insurance and gas is included for the borrowers, while the vehicle owners get to turn their car into a virtual revenue-producing machine.
In both Boston and San Francisco, members pay hourly rates ranging from $5 to $12 per hour, depending on the model year and class of vehicle. These hourly rates include 20 miles per reserved hour, with a 160-mile daily limit.

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Based in Cambridge, MA this multinational for-profit company went public on April 14, 2011 and quickly achieved a valuation of over $1 billion dollars. Zipcar has about 8,500 vehicles in 14 U.S. and 2 Canadian cities, plus over 200 college campuses. They also have an office in London, England, and claim to be the world’s largest car share service. Members can use Zipcars in any location including London UK, making this option appealing for city-hopping car share fans.
Boston Zipcar users choose between an “Occasional Driving” and “Extra Value” plan, depending on anticipated usage. Sample rates here range from $6.59 to $7.75 per hour, and $61.20 to $93 per 24-hour period. Prices include 180 miles per day, with annual fees and membership application fees billed in addition to usage rates.
Other Perks of Car Sharing
Many auto share organizations have partnerships with local businesses to offer their members discounts – like deals on bike repairs, organic groceries, and restaurant meals. In some cities, car share members enjoy reduced transit pass rates and many organizations have reciprocity agreements with other car share companies to allow visiting members vehicle access.
Future of Car Sharing
According to a study from UC Berkeley, car sharing in the U.S. has experienced tremendous growth over the past dozen years, with over 500,000 members now sharing more than 7,700 vehicles through 227 different programs. It appears that a combination of increased fuel costs and environmental awareness has led to the popularity of car sharing and, with the recent buzz around Zipcar’s IPO, market watchers also seem to think that car sharing is here to stay.