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Car2go expects big growth in vehicle-sharing market

By WANG YING in Shanghai | China Daily | Updated: 2017-04-22 09:57
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A woman drives a vehicle of Car2Share service in Chengdu, capital of Sichuan province. TAN XI / FOR CHINA DAILY

Daimler-owned service provider to drive ahead with key expansion plans

The car-sharing market in China is about to experience explosive growth in the coming three to five years and Car2go China Co Ltd-the Daimler-owned car-sharing business-is strategically prepared to ride the market boom, its CEO said.

"Many organizations and institutions are extremely positive about the outlook for the sharing-car market in China. Instead of predicting figures, I would like to say that sharing is a better choice for our future transportation," said CEO Chen Bing.

The popularity of shared economy, including bike sharing and room sharing, is snowballing among young Chinese consumers in big cities. Car sharing-boasting higher flexibility, mobility and affordability-is a new promising business model attracting carmakers and related players, he said.

Flexible car hire could save consumers the trouble of getting a limited license plate in cities like Shanghai and Beijing, Chen said.

Since launching its car-sharing services in September 2015, Car2go China has deployed 1,000 vehicles in Beijing, Shanghai, Shenzhen, Chongqing, Chengdu, Hangzhou and Guangzhou, with smart fortwo as the major car model, Chen added.

Daimler, the parent company of Mercedes-Benz, now has more than 250,000 registered users in China, whose distance traveled to date has almost reached 5 million kilometers.

Unlike other cities, Chongqing launched a free-floating service, dubbed Car2go, where cars can be picked and parked in almost all the major downtown public parking spaces. In contrast, other cities use the Car2Share mode, with users having to fetch from and return cars to predetermined places.

"The different mode is decided by the size of each city. In the first-tier cities of Beijing, Shanghai and Shenzhen, if users are allowed to park and pick up cars wherever they want, the operating company would face a shortage of parking spaces," said Chen.

She added, however, that there are about 70 locations in the three cities for either picking up or parking shared vehicles.

Chen said Car2go China will make 4,000 vehicles available for rental this year, while continuing to add more vehicles in the existing seven cities and expanding parking and pickup locations.

"Users can simply rent the car through WeChat and choose the most suitable rental period in terms of minutes, hours, days or even for the full weekend, at an average cost of 6 yuan (87 cents) for 30 minutes," Chen said.

So far, more than 20 Chinese cities have introduced timeshare rental cars to their roads, according to Beijing-based Economic Information Daily.

In a UBS Investment Bank report, its head of China equity research and head of Asia autos research Hou Yankun said car sharing is one of the four key areas for the automotive industry to focus on in the coming decade, along with electric vehicles, internet of vehicles and self-driving technology.

"The utilization rate of a car is a mere 4 percent, which means it spends only one hour per day on the road, and the other 23 hours are spent in a parking lot. Timeshare rental is hence a good way to make the most of a car," said Hou.

 

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