CONSUMERS DRIVE DOWN COSTS BY CAR SHARING

New findings show car owners could save over £3,000 a year with car sharing
londoners could benefit from up to £1bn per year by switching to zipcar

2012-05-16 00:00:00 America/New_York

LONDON, May 16, 2012 - Zipcar, Inc. (Nasdaq: ZIP), the world’s leading car sharing network, today released new cost-savings data to support the growing transition from car ownership to car sharing – citing savings of up to £3,162 a year.1

Zipcar is a car sharing scheme, which offers a solution to the changing needs of city living and provides access to a range of low-carbon vehicles on a pay-as-you-go basis, for anything from one hour to a week at a time. With the cost of living increasing and rising fuel prices, Zipcar has looked into UK car ownership data from the last year, the average number of miles driven and associated running and maintenance costs, in order to calculate the savings to be made by joining a car club.

Zipcar vs. car ownership1

Savings vary according to individual usage patterns, and the study shows that car owners who use their vehicle infrequently, especially those who commute by public transport, stand to make significant savings.

The data reveals that a typical Zipcar Member saves £3,162 per year, or £264 per month, compared to owning a private vehicle. Additionally, businesses using Zipcar have reported savings of up to 25% against private mileage reimbursement, taxis, fleet cars and traditional car hire.

Capital gains1

The study calculates that if just 12% of Londoners with a car switched to Zipcar, the Capital could save up to £1bn per year on the cost of motoring. Every additional 1% would add £80 million in savings.

Zipcar has become an increasingly popular alternative for urbanites who need occasional use of a vehicle. In addition to cost-saving benefits, members can enjoy a more flexible and eco-conscious alternative to traditional car ownership. Zipcar operates in London, Bristol, Cambridge and Oxford, and has a fleet of over 1,800 vehicles, located close to members’ home and places of work. Whilst studies have shown that every Zipcar takes at least 15 vehicles off the road, as members sell private cars in order to car share.2 Car club members also tend to spend 50% less time behind the wheel compared to private car owners, instead choosing to use public transport, walk and cycle.3

Mark Walker, general manager of Zipcar UK comments: "With the current crunch on household budgets, it’s clear that the high fixed costs of owning a car are motivating people to think about the need for owning one. Our research shows us that the majority of private cars are unused 90% of the time, and often used just once a week to do the weekly shop or go away at the weekend, meaning that opting for a service like Zipcar for many is a smart, cost effective and eco-conscious alternative to owning a car."

Freedom from the stresses of car ownership

A recent study of 2,000 British adults by Zipcar looking at the stresses and strains of urban living, highlights car ownership as an area of stress for city dwellers. Fuel prices were cited as one of the top stress of car ownership (57%), followed by insurance costs (9%) and parking (8%).4

Fortunately, Zipcar members are freed from the burdens of car ownership. Zipcar membership offers cars by hour or the day for a simple fee, from as low as £5 per hour and £49 per day, and includes parking, insurance, 40 free miles, the Congestion Charge, maintenance and 24/7 roadside assistance. Thus, Zipcar offers the freedom and benefits of car ownership, without the headaches or cost.

Flexible alternative to car ownership

The service is simple to use and members can reserve and access a vehicle in a matter of seconds. Members can reserve a Zipcar using a Zipcar app on their smartphone, online or over the phone, which means they can book a car on the go, minutes or months in advance. UK members also have access to Zipcar’s industry-first "Reserve a Zipcar" Facebook app, enabling members to reserve a car, check availability and manage existing reservations without leaving Facebook.

To find out how much you could potentially save by using Zipcar instead of owning a car, use the Zipcar Savings Calculator: zipcar.co.uk/london/is-it/savings-calculator

Notes to Editor

1 Savings calculation breakdown:

  • The average car club household drives 2,400 miles per year.

  • We rounded this to 2,000 miles and compared the cost of that usage in a private vehicle with the cost on Zipcar. (In practice, the same households would drive double the mileage in their privately-owned vehicles, so this is a conservative estimate).

  • The cost of using Zipcar is taken from a typical annual usage pattern of 15 reservations which add up to 2,000 miles per year, using Zipcar’s online price calculator. This gives a figure of £1,206 per year.

  • The cost of private ownership is the average of two figures calculated from the latest data published by the AA and RAC, which is £4,368.

  • Therefore, the annual savings for the average Zipcar Member are £4,368 - £1,206 = £3,162, and the average monthly saving is £3,162 / 12 = £264.

  • To get a hypothetical figure for all London, we multiplied the individual saving by the number of cars on the road in London (Number of Licensed Vehicles, Greater London Authority 2011) £3,162 x 2.6 million = £8.2bn: 12% of this is £1bn, and 1% is £80 million.

2 Research from Frost & Sullivan estimates that, on average, each shared vehicle replaced 15 personally owned vehicles (Frost & Sullivan's studies, N748-18, "Sustainable and Innovative Personal Transport Solutions – Strategic Analysis of Car sharing Market in North America")

3 Carplus, the national charity promoting responsible car use, shows that, in the UK, the average licence holder drives 9,709 km per year, emitting 1.969 tonnes of carbon dioxide. After joining a car club, reducing mileage by 50% and using a newer, more efficient car, this figure would be reduced to 0.459 tonnes of carbon dioxide per year, a four-fold decrease.

4 Research carried out with a sample of 2,000 respondents, aged 18+ on 5 April 2012 by One Poll, who is a member of ESOMAR and employ members of the MRS.

About Zipcar

In the UK, Zipcar operates in London, Bristol, Cambridge and Oxford. In London, there are over 1,700 vehicles available for use at convenient locations across the Capital. Members benefit from: 40 miles of fuel, insurance, maintenance, roadside assistance, road tax and the Congestion Charge all included. Zipcar offers 11 makes and models of self-service vehicles by the hour or day to residents and businesses looking for an alternative to the high costs and hassles of owning a car. More information is available at www.zipcar.co.uk.

Photos and b-roll footage are also available.

For further information: Josie Whittle, Weber Shandwick, +44 0207-067-0645, jwhittle@webershandwick.com