25 sep 18

Will Ride Hailing kill free-flow Car Sharing?

Despite stationless car sharing systems being implemented around the world, it’s a bit tough to make money on such as system in the face of fraud, theft, and logistics challenges, according to some experts.

“These types of systems are being tested around the world and many of them have not shown much success. Besides the challenge of maintaining and cleaning cars which flow freely throughout a city, the routes they utilize are not balanced enough,” vehicle fleet management expert Guilherme Braz told Global Fleet.

For instance, let’s imagine hundreds of people using these per-minute car rentals to go to a huge music festival in an isolated area, said Braz.

“Although many cars would be driven there, they may not come back as festival attendees may opt for Uber rides after a long night of drinking,” Said Braz who is director of client pricing and experience for Brazil’s largest car rental and fleet management company Localiza.

If this happens, the owner of the car-sharing service could end up having several cars stuck at the event.

“How can you run a car-sharing business in a cost-effective way when you have vehicles running around the city independently. In my opinion, ride-hailing services such as Uber are taking over the car-sharing market,” said Joao Andrade, Localiza managing director and a member of the Global Fleet advisory board Latin America.

Finally, in terms of sustainability, we must take into consideration that a ride-hail car could average around 6,000km a month and a car-sharing vehicle, much less.

Localiza managing director João Andrade speaks at Fleet Latam expert meeting at Global Fleet conference 2018 in Rome (Source: Global Fleet)


In support of car-sharing

There are some who are keener to the idea of car-sharing, one being Brazil-based vehicle fleet management adviser Cleber Kouyomdjian who sees it as an ideal way to reduce traffic congestion.

“Besides the cost/km of a ride-hail service being higher than a vehicle sharing system, some studies have shown that the ride-hailing market actually increases the number of vehicles on streets and this is something that is not ideal if you want to reduce traffic congestion,” Kouyomdjian told Global Fleet.

“For us, car-sharing is still new and not very well known so raising the awareness of it is one of the biggest mobility challenges right now, he said.
“We are not against ride-hailing companies, but we do know that more cars mean more traffic and thus more harmful emissions in the atmosphere,” said Kouyomdjian who is a co-founder of fleet mobility startup Move.on and fleet management adviser for PARAR mobility institute in Brazil. 

The autonomous impact

Meanwhile, one up and coming technology which will definitely change the name of the game is autonomous vehicles. Besides free-flowing cars being able to drive themselves back to strategic spots, drivers for ride-hailing companies may become a thing of the past.

Stay tuned for more on self-driving vehicles and other influential factors.


Authored by: Daniel Bland