Bringing Car SHaring to Your Community (CityCarShare 2004)

8/2/2019 Bringing Car SHaring to Your Community (CityCarShare 2004)

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Bringing

Car-Sharing

to Your

CommunitY


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ChaPtEr 1:

introDuCtion

The challenge o the American automobile has had citizens, planners, and environmentalists stumpedor decades. How will it ever be possible to get Americans to give up their love aair with cars?

One o the most eective solutions to date is a project known as car-sharing: a network o cars and

trucks or people to use on a pay-per-use basis. Rather than simply pointing out the negative conse-

quences o automobile dependency and associated sprawl, car-sharing oers a practical, tangible

way to improve the environment, promote social equity and build local capacity.

This guide is or anyone who wants a practical guide to starting a car-sharing organization in his or

her community. While it draws heavily on City CarShares experience in developing a successul pro-

gram in the San Francisco Bay Area, it is intended to provide advice to anyone in North America.

W s c-s?

Car-sharing is a neighborhood-based transportation service that allows people to use a car when

needed, without the costs and responsibilities o ownership. It converts automobile use rom a prod-

uct to a service, providing people with use o a car instead o ownership.

Cars o various sizes are kept in small parking lots all over a city. Members make reservations on-line

or via a toll-ree phone number, walk to the closest lot, access the car using an electronic key ob,

and drive o. They are billed at the end o each month based on usage.

Car-sharing comes in many orms, even within North America. Dierent organizations concentrate

on dierent markets, and have varied pricing structures and technologies. The essential eatures

o car-sharing, however, are as ollows:

Short-term rentalS. Car-sharing charges by the hour, and usually by the mile as well, making short trips

cost eective.

neighborhood-baSed, decentralized vehicleS. Car-sharing operators place pods o cars at locations all

around a city, ensuring they are within an easy walk o as many people as possible. Most pods have

one or two vehicles, but some are larger.

Self-acceSSing. Car-sharing allows members to reserve a car online or by telephone, open the doors

with their own electronic key, and return the car without ever dealing with anyone else. This allows

car-sharing to provide service more eciently than rental car agencies, eliminating the time-consum-

ing hassle o the check-in process.


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different vehicleS for different uSeS. Most car-sharing operators have a varied feet. Members can

reserve a big vehicle to go camping, a pick-up truck to move urniture, and small, uel-ecient cars

or other trips.

full, turnkey Service. Car-sharing services include uel, maintenance, insurance, and reserved parking

at the pod. This saves members money. But avoiding the hassles o vehicle ownership is also one othe key attractions o car-sharing. Members out-source the chores that go along with ownership.

Wc ces ve c-s?

The car-sharing concept originated in Switzerland in 1987, and one o the largest car-sharing opera-

tions in the world is still run by Mobility Switzerland, in close partnership with the Swiss Federal

Railway. It runs a feet o 1,650 cars in more than 930 locations, and has enrolled more than 58,000

members. As well as its size, the Swiss program has enjoyed enormous success in infuencing travel

behavior. Surveys show that members who gave up their car ater joining the car-sharing programincreased their transit usage by 35%, rom 3,560 miles per year to 4,810 miles per year. Walking and

cycling levels also increased, while vehicle miles traveled, in contrast, ell by 75%.

Car-sharing spread to North America in the early 1990s, beginning in Quebec City in 1994, and

entering the United States in Portland, OR in 1998. Nearly 20 major cities, plus a ew smaller towns

and university campuses, now have car-sharing. Some o these smaller communities just have

a single shared car. Others have more than a hundred.

Figure 1: Car-Sharing LoCationS, 2004

Portland

Seattle

Vancouver

Whistler

NelsonVictoria

Calgary

Denver

Aspen

Boulder

San Francisco Bay Area

Los Angeles UC RiversideUC Irvine

San Diego

Philadelphia

New York City Region

Princeton

Washington, DC Region

UNC Chapel Hill

Chicago

Madison

Qubec

Montral

OttawaGatineau

Sherbrooke

Kingston

Toronto

Kitchener

Boston


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W e e beefs?

Car-sharing brings a broad range o social and environmental benets or members, non-members

and the wider community. In short, it can help make communities more vibrant, attractive, and less

dependent on the private automobile, and contribute to a range o transportation, housing, eco-nomic development and social justice goals. Some o the most notable benets include:

leSS land needed for parking. Car-sharing is a proven strategy to reduce the demand or parking.

Independent surveys consistently show that each car-sharing vehicle replaces as many as seven

private cars or more, as members sell or scrap their cars. This means that car-sharing can be a cost-

eective alternative to building more parking garages, which oten cost $30,000-$50,000 per space

in urban areas. Instead o parking lots and parking garages, car-sharing also allows us to use land

or higher and better uses like housing and parks, helping to reshape our urban areas into a more

environmentally sustainable orm.

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i n

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Figure 2: City CarShare iMPaCtS on VehiCLe oWnerShiP.

2

0

-10

-8

-6

-4

-2

ChangeinCarOwnershipper35M

embers

-12

Members Non-Members Difference

Source: Based on Cervero & Tsai, 2003

reduced vehicle travel and congeStion. Once members sell their cars, they drive less. They have access

to a car whenever they need it, but use it only when it is truly the best alternative, rather than as the

deault means o travel. Car-sharing members have an incentive to drive much less, since the ull

costs o driving are visible in each trip (see Chapter 2). Car-sharing at the workplace, meanwhile,

allows people to commute by transit to work, since a car will be available or errands and meetings

during the day.

In San Francisco, Cerveros research ound that City CarShare members drive an average o 47%

less ater joining. In addition, City CarShare trips tend to be made at o-peak times, to destinations

that are poorly served by transit. Rather than driving to work, City CarShare members practice

judicious automobility, using the vehicles or occasional trips such as shopping and recreation.

In Europe, where car-sharing has been established longer, members who give up their cars ater join-

ing reduce their driving by up to 75%.

The greatest benets, however, will come in the long term, as car-sharing makes it possible to build

denser, transit oriented development projects in existing urban areas. Residents o dense, urban

areas drive up to 80% less than those in suburban ringe locations.


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Figure 3: iMPaCt oF SWiSS Car-Sharing on VehiCLe traVeL

6000

4000

MilesDriven/Yea

r

2000

0

5779

Before Joining

1616

After Joining

Source: Mobility Switzerland. Figures are or those members who give up their car.

Figure 4: iMPaCtS oF City CarShare

125%

100%

-25%

0%

25%

50%

75%

%C

hange(

Feb01toMar03

-50%

Vehicle Travel Gasoline Consumption CO2 Emissions

Members Non-Members (Control)

Source: Based on Cervero & Tsai (2003). Note that the fgures include gasoline consumption and

CO2 emissions rom transit vehicles and carpools. The reduction in uel usage and emissions rom

private cars will be even greater.

emiSSionS reductionS. Car-sharing reduces emissions o greenhouse gases and other pollutants, simply

by encouraging people to drive less. The benets are amplied, however, through allowing mem-

bers to pick the right car or the right trip. Rather than owning a large amily car or SUV to cope

with camping trips once a year, car-sharing gives them access to a range o vehicles a compact

car or trips around town, or pick-up trucks to move heavy loads. Whats more, most operators use

modern, uel-ecient cars including hybrids while the cars they replace tend to be older and

more polluting.


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promoting tranSit. As members drive less, they take more o their trips by transit. Car-sharing also

generates many combined trips, as members take transit to a station or bus stop close to their

destination, beore picking up a car-sharing vehicle to drive the nal leg o their journey. Nearly 20%

o members get to their City CarShare vehicles by transit a gure that rises to more than 55%

at some pods located at BART stations. An early study o City CarShares partnership with BART

ound that each vehicle parked at a BART station generated around 50 o these roundtrip transitrides per month.

reduced tranSportation coStS. Car-sharing can provide tremendous cost savings to amilies who need

occasional access to a vehicle. According to AAA, a compact automobile costs $5,000 per year,

or depreciation, insurance, taxes and nance charges. The average City CarShare member, in con-

trast, spends $540 and drives 435 miles per year (Figure 5). Car-sharing allows low-income people

to make necessary car trips such as taking a child to the doctor or interviewing or a job, without

the crushing burden o car payments, insurance, parking, and other and associated costs.

Figure 5: CoStS oF City CarShare VS. VehiCLe oWnerShiP

$1,000

$2,000

$3,000

$4,000

$5,000

AnnualCost(435Miles/Year)

$0City CarShare Ownership

Ownership Cost Usage Cost

affordable houSing. In many communities, parking requirements set by local jurisdictions are the single

greatest barrier to the construction o aordable housing. Each residential parking space entails

a cost o $25,000 or more, which is either borne by residents or requires greater public subsidy.

Including car-sharing as part o new housing developments can reduce the amount o parking that

has to be provided, thereby bringing down the cost o housing and allowing more units to be built.

local economic development and capacity building. Car-sharing keeps money circulating in the local com-

munity. Since car-sharing members pay or each use, they are more likely to walk to the local store

or basic items. Car-sharing thus supports local shops and services, which are the heart o many

communities. People begin to have a taste o cooperative, locally-controlled economic relationships.

Nonprot car-sharing organizations also rely on local leadership, providing an opportunity to build

capacity in the community and respond to local needs.


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fleet management SavingS. The City o Philadelphia recently joined Philly CarShare as an organizational

member, allowing City employees to use car-sharing vehicles and the City to save money by selling

400 municipal feet cars. Many other businesses, public agencies and nonprots have realized that

car-sharing is a more cost-eective and higher quality alternative to managing their own feets.

Wc del s y cy?

While City CarShare is a 501(c)(3) nonprot, dierent car-sharing operators have dierent business

and organizational models. Some are or-prot companies, accountable to venture capitalists and

other investors. Some, such as the Community Auto Network in Vancouver, are cooperatives. Others

are run by local governments, or on an inormal basis.

In order to grow large and begin to replace private car-ownership, car-sharing organizations must

be proessionally run and businesslike. However, there is no single ideal model, and the best

approach will vary between communities. For-prot organizations and cooperatives have achievedgreat success in many parts o North America. City CarShare, though, believes that the nonprot

model is the most appropriate model in achieving our mission in the San Francisco Bay Area (see

sidebar). Reasons include:

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This handbook has 10 chapters:

chapter 1: introduction summarizes the concept and benets o car-sharing, and discusses the dier-

ent models that have emerged in North America.

chapter 2: buSineSS planning considers the issues that will need to be addressed in the business plan.

What is the competition? What are the markets or car-sharing? In what types o neighborhood

is it likely to succeed?

chapter 3: financial planning explains how to draw up a budget. It discusses how much it will cost to get

car-sharing up and running, and sources o unding such as usage ees and grants rom government,

industry and oundations. The chapter also outlines measures o success.

chapter 4: recruiting the right people ocuses on human resources. What skills are needed on the Board

and on sta? How many people does it take to run a car-sharing program, and what jobs need

to be done?

chapter 5: building partnerShipS explains how to work with cities, transit agencies, developers and other

partners. It shows what they can do to support car-sharing and what car-sharing can do or them.

chapter 6: outreach and marketing discusses how to get the word out about car-sharing, rom doorhang-

ers to newsletters and media events.

chapter 7: operationS talks about the nuts and bolts o car-sharing. What vehicles are best, and should

they be leased or bought? How do you obtain parking, insurance and a web-based reservation

system?

chapter 8: threatS to SucceSS suggests what not to do. Learn rom the mistakes o the rst operators!

chapter 9: Special nicheS discusses the potential or car-sharing on college campuses, at transit stations,

and as a replacement or government vehicle feets.

chapter 10: So you Still Want to do it? provides a checklist or getting started!

further reading provides some useul reerence sources, all available online.


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ChaPtEr 2:

BuSinESS PLanning

Wy Bsess Pl?

Regardless o whether an operator is or-prot, non-prot or cooperative, it needs to be run like

a proessional business. For car-sharing to realize environmental benets, members need a well-run

organization that they can count on, particularly when making major decisions such as whether

to buy or sell a car.

In many cases, a business plan will be a prerequisite or qualiying or public or oundation unding.

Regardless, it will help to establish principles or the organization, such as target markets and und-

ing sources. It will also answer many critical questions, such as start-up capital required, pricingstructures, and stang needs. It will predict the size that an operator needs to reach in order to break

even nancially, and the steps that need to be taken to achieve the required growth. Careul analysis

in the business plan will provide the template or an organizations growth and development.

te Cpe

private automobileS are the chie competitor or any car-sharing organization. The success o car-shar-

ing both in terms o nancially viability and achieving environmental goals will be largely depen-

dent on the extent to which members can be persuaded to sell their cars.

Cost savings are one o the major motivations or members to join a car-sharing program. Car-shar-

ing turns xed motoring costs into variable ones (see sidebar), meaning that the greatest savings

will be realized by people who drive only occasionally. A cost comparison between car-sharing and

private car ownership is a useul exercise or any operator beore nalizing a rate structure; AAA

publishes data on the costs o automobile ownership and use.

At City CarShares current rates ($4/hour peak, $2/hour o-peak and 44 cents/mile), or example,

the break-even point lies around 5,000 miles a year (Figure 7). For people who drive less than 5,000

miles a year, car-sharing is clearly a cheaper option than owning a car. The same is true or house-

holds who could drive less than this amount, and those that have a second car that is driven lessthan 5,000 miles per year. Car-sharing is not a nancially attractive option, however, or commuters

who requently drive to work.


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Car-sharing also competes with the private automobile on non-monetary grounds. The non-mon-

etaryadvantages o car-sharing include:

New vehicles

No maintenance or repair responsibilities

Vehicles always clean

Dierent vehicles or dierent purposes (whereas private owners have the same car all

the time)

Guaranteed parking space, close to home

Personal values including environmental reasons, and a greater sense o community

engagement

The non-monetary disadvantages o car-sharing include:

Must reserve vehicles

Risk o vehicles not being available when wanted

Must walk, bike or take transit to a vehicle

Must return vehicle at specied time and place

Must remove belongings rom car beore returning it, even when in a hurry

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Figure 6: FixeD anD VariaBLe CoStS oF Car oWnerShiP

$120

$40

$80

CostperMile

$0

5,000 Miles/Year

$0.12 $0.12

$0.50

$0.12

$0.33

$0.99

10,000 Miles/Year 15,000 Miles/Year

Ownership Costs (Fixed) Operating Costs (Variable)

Data rom AAA, 2003. Figures assume compact car (2003 Chevrolet Cavalier LS).

Figure 7: CoStS oF PriVate oWnerShiP VS. City CarShare

$14,000

$16,000

$18,000

$12,000

$2,000

$4,000

$6,000

$8,000

$10,000

$0

0 5,000

Miles Per Year

10,000 15,000

CostPerYear

City CarSharePrivate Car

Assumes average o 5.5 miles per hour o CCS usage. Private automobile costs rom AAA (2003).

Based on January 2005 rates, assuming hourly average cost o $3.50.


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rental carS are largely complementary to car-sharing at present, providing additional options or lon-

ger trips where they tend to be more cost-eective. However, there is some competition in the area

o overlap where the cost is similar.

Car-sharing has several non-monetary advantages over rental cars most importantly, convenience.

Car-sharing pods are located close to homes and businesses, and members avoid hassles waitingin line and checking in and out. However, rental cars tend to have a wider variety o vehicles, oer

unlimited mileage particularly important or longer weekend trips and have more consistent avail-

ability o vehicles, particularly on weekends.

taxiS provide additional options or one-way trips, which are not oered by any major car-sharing

operator in North America. Taxis also serve those who are unable to drive, or example due to age,

disability, lack o a valid license or temporary intoxication. However, car-sharing is cheaper and

works better than taxis or most round trips.

againSt all competitorS, one of the main StrengthS of car-Sharing organizationS iS the organizational ethoS. Mem-

bers like the idea o supporting a grassroots, community based organization, that provides a practi-

cal solution to the problem o overdependency on the private automobile.

tranSit, bicycleS and Walking are not competitorS. In order to maximize environmental benets, car-sharing

operators should seek to promote these transportation options as the rst choice or their custom-

ers, and encourage them to use car-sharing or only those trips where these modes are not a realis-

tic alternative. This can be accomplished through a pricing structure that charges members by the

amount that they drive, rather than pricing plans that include a pre-paid number o miles and hours

(see Chapter 3).

the real competition for car-Sharing iS private car oWnerShip. Car owners are the largest potential market,

and the most important one to tackle to ulll environmental and social change goals. Other means

o transportation are largely complementary (see Figure 8).


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Figure 8: Car-SharingS Market niChe

Source: Eric Britton (1999), Carsharing? A roadmap and compass or this long trip, World Transport

Policy and Practice, 5(3): 1-8.

te mkes C-S

Individual Members

Most car-sharing members are individuals. Many operators also oer household memberships,

allowing amily members or roommates to be added to the same account. For all purposes apart

rom billing, individual and household members can be treated identically.

One way o segmenting the pool o potential individual members is by their current car

ownership status:

people Who could Sell their car. This generally means existing car owners who drive only occasion-

ally. The exact mileage threshold below which car-sharing is more cost-eective will depend on an

individual operators rate structure.

houSeholdS Who could Sell their Second car. Households that own a second car or occasional useor added fexibility could cut down to just one car and use car-sharing or those times they need

an extra vehicle.

car-free houSeholdS. Many people will join who dont own a car, but occasionally need one or gro-

cery shopping or moving urniture. These people may borrow or rent cars at present, or simply

do without.

Public Transportation

Car-Sharing

Bike

Taxi Car Rental

Distance

Flexibility


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people Who are thinking about buying a car. Caught in the period o cost-calculation that most people

go through when deciding about buying a car or not, car-sharing will oten be the most cost-eective

option. People are most receptive to the idea o car-sharing ollowing these trigger events such as

changing job, moving home or the need or expensive auto repairs.

Business Members

Business members usually join in order to provide mobility options or their employees or work-

related purposes. As well as private businesses, these members can include nonprot organiza-

tions and other employers such as government agencies, who make car-sharing available to their

employees or work-related purposes. They are billed as a single entity, with an itemized record

o each employees trip use.

While businesses account or a relatively small share o the overall membership o most car-shar-

ing operators, they are particularly valuable in helping to even out the demand cycle. Their peak

demand is during the working day, while demand rom individual members peaks in the evenings

and weekends.

One way to segment the pool o potential business members is by their current methods o having

their employees get to meetings that require a car:

Organizations that have their own feets, but could replace or partially replace these with car-

sharing. These organizations may also be encouraged to orego the purchase o a new feet

vehicle as a result o using the car-sharing system.

Organizations that currently rely on employees own cars, rental cars, etc. Car-sharing can

provide added convenience and fexibility, as well as reduce the need or employees to drive

their own car to work or use during the day.

Transit Transers

Both individual and business members can be subdivided into two urther categories: the walk-to

market and the transit transer market. Members who walk (and bike) to pods usually represent the

core market or car-sharing; a well-placed network o pods will provide cars within walking distance

o as many members as possible. However, the transit transer market is also important in serving

three distinctive types o trips:

Where all vehicles at the closest pod are already reserved, some members may be willing

to take transit to get to a dierent pod.

Members who do not live within walking distance o a pod may be willing to take transit

to get to a car.


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Members can take transit or part o their trip and then transer to a shared vehicle to get

to their nal destination. This is a critical market or car-sharing operators to develop because

it is so directly tied to environmental goals: through providing cars at the end o major xed

line transit stations, transit operators can capture trips they would otherwise lose.

Dedicated Fleets

Some car-sharing operators provide dedicated feets or large business or government custom-

ers. For example, cars may be provided exclusively or city employees during the business day, and

then made available to all members in the evenings and at weekends. Alternatively, certain cars may

be exclusively reserved or a specic group o users at all times, such as residents o a particular

apartment building.

Wee Plce VeclesCar-sharing does not work everywhere, and potential locations have to be evaluated rigorously

or their economic viability. One o the most important prerequisites or success is a high level

o density. Other criteria include a mix o land uses, good transit access, low vehicle ownership

levels, and a pedestrian-riendly environment. A good location may not score highly on all o these

criteria, but at least some are needed to make car-sharing work.

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Density

Density is one o the most important actors determining the viability o car-sharing or two key

reasons. First, to provide an attractive alternative to car ownership, car-sharing must be convenient

to get to, and density provides a measure o the potential customer base within a short walk (5-10

minutes) o a pod. Doubling density doubles the number o potential customers.

Second, households living in dense neighborhoods tend to own ewer cars. Density is a good indi-

cator o the quality o transit, the pedestrian environment, and local shops and services, making

a car-ree liestyle a realistic option. At densities above 25-30 units per acre, vehicle ownership starts

to all below one car per household (Figure 10).

In practice, this means that considerably more outreach and marketing will be needed i car-sharing

is to work at lower densities. Figure 9 shows the penetration rates needed to achieve 25 members

per vehicle within a 5-minute walk at various densities. While these gures will be lower i business

members are recruited, or i members are willing to walk longer distances to a pod, they provide

a good indication o the level o market penetration that will be required.

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Figure 9: Penetration rate reQuireD

Residential Density

(persons/acre)

Penetration Rate Needed*

One-vehicle pod Two-vehicle pod5 3.98% 7.96%

10 1.99% 3.98%

15 1.33% 2.65%

20 0.99% 1.99%

25 0.80% 1.59%

30 0.66% 1.33%

35 0.57% 1.14%

40 0.50% 0.99%

45 0.44% 0.88%50 .50% .80%

* To achieve 25 members per vehicle within 1/4 mile radius (equivalent to a 5-minute walk).


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Figure 10: auto oWnerShiP VS. reSiDentiaL DenSity

S.F.

L.A.

Chicago

3.00

.50

1.00

1.50

2.00

2.50

Vehicles/Househo

ld

.000 50 100 150 200

Households/Residential Acre

Auto Ownership vs. Residential Density

Source: Holtzclaw, John et. al., Location Efciency: Neighborhood and Socio-Economic Charac-

teristics Determine Auto Ownership and Use Studies in Chicago, Los Angeles and San Francisco,

Transportation Planning and Technology, 25(1): 1-27.

Other Criteria

Density is one o the most important actors indicating the viability o a pod and is also the easiest

to map and quantiy. However, other criteria that should be taken into account include:

parking difficulty and coSt. Where parking is dicult, there is a strong incentive to share a car in order

to avoid the hassle and expense o parking. While it may be tempting to start car-sharing where

parking can be obtained cheaply, this will almost certainly be a counter-productive strategy

in the long run.

loW vehicle oWnerShip. While many people will sell their car once they join a car-sharing program,

others will use car-sharing to improve their mobility and travel choices. This means that car-sharing will

be most viable in a neighborhood where ewer people own cars or where households have one

rather than two vehicles. In addition, low vehicle ownership in a neighborhood indicates that selling

a car and joining a car-sharing program will be a realistic option or many households, due to good

transit access and shops and services within walking distance. The US Census provides data on car

ownership rates that can be easily mapped.

a mix of land uSeS. People who use car-sharing or work tend to need cars during the day. Individ-

ual members tend to want them in the evenings and at weekends. This means that a mix o resi-

dential and employment land uses is important to ensure that the cars are used enough to make

the pod viable. Shared cars in a purely residential area, or example, may not receive sucient

usage during the day, while those in an oce park are unlikely to be used much in the evenings and

on weekends.


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neighborhood amenitieS. People who can easily walk or convenience retail services are less likely

to need to drive everywhere. In addition, retail centers are good pod locations, because people are

used to going there on oot or their errands.

good tranSit acceSS. Car-sharing can never be the sole transportation option or a household. Instead,

it gives people the reedom to replace their car with a package o alternatives car-sharing, transit,taxis, rental cars and walking and cycling. Car-sharing will be a ar more attractive option in neigh-

borhoods that are well served by requent, reliable, comortable transit. In addition, some people

making longer distance trips are likely to arrive at the pod by transit, and make the last leg o the

journey by car-sharing. This integration can be best achieved where the pod is at a rail station

or busy bus stop.

member intereSt. A useul strategy can be to ask potential members or expressions o interest, indicat-

ing where uture demand is likely. Existing car-sharing operators can also map the locations o their

current members, and plot concentrations that are not served at present.


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Es mke Pel

These criteria can be used to estimate the market potential o each pod, based on the three most

important market segments: residents, businesses and transit transers. Figure 8 shows a possi-

ble ormat or the calculation. The most critical assumption is the penetration rate or each group.This will usually be ar higher or residents compared to employees and business members.

It is important, however, to be realistic theoretical studies in Europe have suggested that 0.3%-9%

o the population could benet rom car-sharing, but the actual number will be much lower.

Figure 11: eStiMating the Market near a PotentiaL PoD

roW # PoD 1 PoD 2

reSiDentiaL Market

1 Housing Units Within 1/4 Mile

2 Residential Penetration Rate (%)3 Potential Residential Members = 1 * 2 = 1 * 2

BuSineSS Market

4 Jobs Within 1/4 Mile

5 Business Penetration Rate (%)

6 Potential Business Members = 4 * 5 = 4 * 5

tranSit tranSFer Market

7 Transit Riders/Day

8 Transit Penetration Rate (%)

9 Potential Transit Market = 7*

8 = 7*

8

10 totaL PotentiaL Market = 3 + 6 + 9 = 3 + 6 + 9

Exps Pds Vecles?

Cars should be ideally grouped into pods o at least two to three vehicles per location, with a cor-

responding set o at least 50-100 members in proximity to the pod. However, the number o cars per

pod should be based on demand. In most cases, it makes sense to begin with a one-car pod, and

add new vehicles as utilization warrants. The business plan should speciy the threshold or adding

a new vehicle, such as a certain average revenue hours per day or revenue per vehicle.

The decision on whether to add a new vehicle to an existing pod, or open a new pod nearby, can be

a dicult one. One o the main attractions o car-sharing is its convenience and proximity to mem-

bers homes and places o work The denser the network o pods, the more competitive car-sharing

will be against private automobiles and rental cars


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Set against this, however, are many practical reasons to expand existing pods instead, and the

precise balance between operational ease and network density will need to be determined by each

operator. Advantages o multi-car pods include:

Availability is increased, allowing utilization to be maximized or a given number o vehicles.

A member has more chance o being able to get a reservation at their preerred pod, sincethere is more likely to be a vehicle available or a given utilization rate.

Random variations in demand are smoothed out at larger pods. This allows pod size

to be optimized to cater to a consistent demand.

Scheduling is more resilient. There is more likely to be a spare vehicle available to accom-

modate late drop-os, early pick-ups or breakdowns, or to allow members to extend

a reservation.

Cleaning, maintenance and other operational issues are eased, and there is less need

to negotiate with multiple parking operators.

Pod set-up costs, such as hardware, signage and web programming, are minimized.

Larger pods make it easier or people to nd vehicles because they make signage, market-

ing, and automated reservations easier.

Cls Dwsz Pd

Removing a vehicle should rarely happen, since pods should be expanded incrementally based

on demand. It may be necessary when a new pod is opened close by, or to accommodate seasonal

changes in demand at university campuses, or example. Providing the pod is kept open, however,

removing a vehicle does not have the major disadvantages that result rom pod closure. The busi-

ness plan should speciy the utilization triggers or pulling a car rom an existing pod.

Closing a pod, in contrast, is a last resort, and should only be undertaken ater extensive local

outreach to try and boost utilization. The success o car-sharing in achieving its overall objectives

depends on it being a permanent eature in the neighborhood landscape, that developers, cities

and individuals can rely on when making decisions on parking provision and whether or not to own

a car.

On the other hand, operators need to be able to experiment with new locations, without losing

money indenitely i the experiment doesnt work. Thereore, it is a reality that pods will be opened

that have to be closed at a later date. The business plan should include detailed criteria or when

to close a pod.


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ChaPtEr 3 FinanCiaL PLanning

Bld BdeThe budget is the most critical component o the business plan. The initial budget, i put together

with sucient care, will be the reality check or whether the organization has sucient capital

to open or business. The budget will also show how it plans to reach nancial sel-suciency.

Virtually every car-sharing operator will have a signicant cashfow decit in the early years. It either

requires unding rom local governments, oundations, auto manuacturers and similar organizations,

or rom private investors. However, this should narrow rapidly or several reasons:

A signicant amount o sta time will be taken up with one-o planning tasks, such as deter-

mining initial pod locations, securing parking, negotiating with service providers, and undraising.

Utilization rates will tend to rise as the organization reaches a critical mass o members

and vehicles.

Economies o scale can be realized when the organization reaches a certain size, such

as volume discounts or vehicles.

As an organization expands, overhead costs such as oce space and sta will be spread

out over a larger number o vehicles. While stang needs will increase, the ratio o sta

to members and vehicles should all over time (see Measuring Success, below).

A sample budget template is shown in Figure 11. Line items are discussed individually in the ollow-

ing sections.


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Css

Most o the costs o running a car-sharing organization have been discussed in previous chapters.

A useul distinction is between vehicle costs, which will tend to be directly proportional to feet size,

and overhead costs, which should grow more slowly.

Overhead/Fixed Costs:

Salary and benefitS. Car-sharing is inherently labor intensive; it is a system that allows people to make

more intensive use o an expensive capital resource (cars) by creating a new social arrangement

or using the cars. Having said that, one o the most important cost-control strategies is to reduce

labor costs through automating routine unctions, such as billing and member applications.

(See Chapter 4 or a ull discussion o stang issues.)

rent. Any proessional car-sharing organization will need oce space. However, this may be sharedwith other nonprots, or donated by local governments.

technology. O-the-shel reservations and access technology will be the most cost-eective solution

in most cases.

marketing and public relationS. At a minimum, marketing expenses include the design, printing

and distribution o materials such as brochures, doorhangers and postcards. In some cases,

an organization may want to purchase advertising space. Hiring a specialist public relations rm may

be worthwhile, but is probably only an option or larger operators.

office SupplieS. As with any organization, oce equipment and supplies such as computers,telephones and stationery will need to be budgeted or.

Vehicle/Variable Costs:

vehicleS. Vehicle leases or purchase costs will oten be an operators largest outlay. Strategies

to reduce these costs are discussed in Chapter 7.

inSurance. Strategies to reduce insurance costs are discussed in Chapter 7.

parking. In many cases, parking will be donated or ree by partner organizations, but will oten need

to be paid or.

gaSoline. These costs will depend on the estimated utilization rate o the vehicles. They can be simply

calculated based on current gas prices and the uel economy o the chosen vehicles. In some cases,

partnerships can be orged with providers.


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cleaning. The budget should allow or cleaning vehicles at least biweekly, plus occasional

extra cleanings.

maintenance. Heavily used vehicles should be taken to the garage or a tune up every 3 months.

The budget will also need to account or occasional damage, or which the member responsible

cannot be identied.

revees

A car-sharing organizations revenue can be divided into two broad categories: earned revenue that

results rom the use o the cars themselves, and other revenue. Over time, the proportion o earned

revenue should rise as an operator moves closer to nancial sel-suciency.

Earned Revenue

The pricing strategy is one o the most undamental decisions that needs to be made by a car-shar-

ing organization. One aspect relates to the overall level o charges. Too low, and nancial sel-su-

ciency will be harder to achieve, and the organization risks encouraging members to drive more.

Too high, and the cost advantages o car-sharing compared to rental cars, taxis and private vehicles

will be eroded, and car-sharing will be put out o reach o lower-income households.

The other aspect o this decision relates to the way in which charges are structured. Some consider-

ations are outlined in the ollowing sections.

Hourly or Mileage Fee?

Some car-sharing operators bundle a pre-set number o miles with each hour o usage, so that

each hour, or example, includes 10 ree miles. City CarShare, in contrast, charges or usage

by both the hour and the mile. This approach ensures that rates are based on quantity o usage,

and that there is no perverse incentive to drive more to get your moneys worth.

The disadvantage o charging or miles and hours separately is that members tend to dislike

the mileage ee. It also makes longer trips less cost-eective, particularly when compared to rental

cars which oten include unlimited mileage.

Membership Fee?

Most car-sharing organizations charge a monthly or annual administrative ee or members.

This enables overall usage rates to be kept lower, and does not present a barrier to high-usage mem-

bers. This is the group that it most likely to have sold their car to join, and thus brings the greatest

environmental benets and potential revenue.


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However, a membership ee can be a major deterrent to members who use the service only occa-

sionally, and primarily join or purposes o mobility insurance. One option is to oer dierent rate

taris or light and heavy users (see below).

O-Peak Discounts?

Peak usage times or almost all car-sharing operators are evenings and weekends. At nighttime,

usage is extremely low. O-peak discounts can help to make use o this spare capacity, while provid-

ing members with a way to lower the costs o car-sharing.

One option is to oer lower o-peak hourly charges. This encourages members who have a choice

o when to make a trip or example to a 24-hour grocery store to do so at o-peak times. Alter-

natively, the daily rate can be capped at a certain dollar amount or hours o usage, helping to make

longer trips or overnight trips (e.g. an emergency ride home rom work) cost eective. This cap

might apply to all vehicles, or only at pods with surplus capacity.

Dierent Rate Taris?

Whichever rate structure is adopted, it will always avor a group o members who make certain types

o trip. For example, a low hourly rate and high mileage rate will penalize members who drive longer

distances but do not leave the car idle or long periods at the destination or example, to pick up

a relative at the airport. A high hourly but low mileage rate disadvantages those who drive a short

distance but reserve the car or a long period or example, or a day trip to the beach. A low cap

on daily costs is good or those who make multi-day trips or take the car overnight, but not or other

users.

One possibility is to oer dierent rate taris or members to choose among based on their usage

patterns. The downside is that it makes car-sharing more complex both or members to under-

stand, and or the operator itsel.


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Cost Comparisons

Beore any rate structure is nalized, a useul exercise is to conduct a cost comparison with rental

cars and taxis. This helps to show which types o trips are avored with a certain tari, and which are

made prohibitively expensive. A sample comparison or City CarShare is shown in Figure 13, based

on various assumptions regarding mileage and time or particular trips. It can also be helpul to con-

duct similar comparisons or the cost o car-sharing compared to private car ownership.

Figure 13: City CarShare CoSt CoMPariSon

175

200

150

25

50

75

100

125

0

Groceries Night Out Beach Errands Airport Day Out Camping

City CarShare

Economy Rental with Insurance

Taxi

Application Fees and Deposits

Most car-sharing operators charge new members a non-reundable application ee to contribute

towards costs such as driving record checks. In addition, a common practice is to ask or a reund-

able deposit. This provides a saeguard against members leaving with bad debts particularly i they

are at ault in an accident and is useul or cashfow purposes.

On the other hand, deposits introduce an additional barrier to joining. Each operator should consider

whether this security could be adequately provided through credit checks or other means. For exam-

ple, students may be allowed to join i a parent cosigns. In any case, procedures or dealing with bad

debt will be needed such as i and when to pass unpaid bills over to a collections agency.


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Contract Revenue

Another possible source o earned revenue is contract revenue, primarily rom larger business mem-

bers who want a dedicated or semi-dedicated vehicle. They may be willing to pre-pay or blocks o

time in return or having a vehicle exclusively available or their employees at certain times. Alterna-

tively, a business or developer may be willing to guarantee a minimum level o revenue in return or

the placement o a vehicle at a specic location.

Other Revenue

Government Funding

Many cities, counties and regional and state agencies have unded start-up costs or local car-shar-

ing operations. Obtaining this unding requires a clear business plan, solid, quantied inormation

on the public policy benets rom car-sharing, and strong relationships with sta and elected o-

cials. Usually, a proposal will need to be directed to specic objectives such as establishing a pod

in a particular location, or serving a particular market.

Unlike other transportation services, car-sharing does not benet rom dedicated unding sources,

meaning that unding will usually be at the discretion o local ocials. Possible sources at the ederal

level include:

Congestion Mitigation and Air Quality Improvement Program

Transportation Enhancement Activities

Access to Jobs and Reverse Commute Program

Transportation and Community and System Preservation Program

Value Pricing Program

Most transportation unding sources are managed (programmed) at the state or regional level,

or example through Metropolitan Planning Organizations. Others are competitive grant programs,

which require a public agency to be the lead applicant. Close cooperation with cities or other local

agencies is thereore essential in securing these unds. A local match is oten required.

Note that ederal transportation legislation was still being nalized at the time o writing, and the

precise programs and eligibility requirements may change rapidly. In addition, each state and met-

ropolitan region tends to have dierent ways o allocating unding, and there will almost certainly be

additional sources o revenue.


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Private Funding

Cooperatives and or-prot car-sharing organizations may be well placed to obtain start-up und-

ing rom shareholders or other investors. Some cooperatives treat the member deposit as a share

in the organization, in practice reunding the money i a member leaves, but providing no guarantees

that they will do so.

Another potential source o private unding is the automobile industry, although this is more likely

to be provided in-kind through discounted vehicles.

Leveraged Value

Car-sharing can provide a substantial benet to partner organizations, which can sometimes

be recouped. For example, car rental companies might agree to pay a xed amount or each reerral

rom a car-sharing operator, in recognition o the volume o business that is channeled their way.

Private Foundations

Foundations and other philanthropic organizations can be a major source o unding or nonprot,

501(c)(3) organizations. Good oundations to approach are those that have programs ocused

on environmental or social issues. The more targeted these programs are, the better many oun-

dations ask specically or proposals addressing transportation or air quality issues, aordable

housing, or mobility or low-income households. The key is to identiy these priorities, and ocus

the proposal on how car-sharing can address them.

The most successul proposals oten identiy a particular program, such as working with develop-

ers or placing a pod in a low-income neighborhood, but many oundations also provide general

operating support. Since car-sharing will usually be an unamiliar concept to oundation ocers,

the proposal should also explain how it works, and provide understandable, tangible inormationon how car-sharing can support a oundations goals.

Success with private oundations depends not only on the quality o the application, but also

on tailoring it to the oundations priorities. A meeting with the oundations program ocer will

help introduce the concept o car-sharing to them, and understand how a proposal can be tailored

to meet their goals and interests.
http://www.mtc.ca.gov/publications/funding_guide/fgindex.htmhttp://www.mtc.ca.gov/publications/funding_guide/fgindex.htm


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Once unding has been received, it is important to continue to maintain good relations with program

sta, in order to maximize the chances o both repeat unding and success with other oundations.

I the unding is or a specic purpose, it should be prominently mentioned in press releases and

other publicity materials or example, or a new pod launch.

Most oundations also require reports detailing how the money has been spent, and it is importantto establish a grant tracking and reporting system or these purposes.

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Other Donations

As well as private oundations, many local businesses make donations to local 501(c)(3) not-or-prot

organizations. Another source o private donations is the membership base. They may be willing

to donate their deposit as an end-o-year tax write-o.

From the environmental point o view, a donate your car program may bring even greater benets.

It provides a tax write-o or members, a source o revenue or the car-sharing organization i the car

can be sold, and maximizes the impacts o car-sharing in taking vehicles o the streets.

reqess PpslsMany public agencies wanting to establish car-sharing in their community will issue a Request

or Proposals (RFP). This is a way to invite bids rom multiple potential operators, and select the one

that oers to provide the best service at the lowest cost. The same technique may be used by other

organizations, such as a university.

The RFP will typically state the services that should be provided, and the criteria that will be used

to evaluate the proposals. There is no single, correct way to respond, since every RFP is dierent.

However, some general principles to bear in mind include:

knoW the competition. On request, most agencies will publicize the organizations that have received

the RFP. This may include car rental rms as well as national, or-prot car-sharing operators. The

next step is to determine the strengths and weaknesses o the organization against the likely com-

petition, and highlight these relative strengths in the proposal.
http://www.foundationcenter.org/http://www.foundationcenter.org/


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be realiStic. Be careul not to overpromise. Agencies usually evaluate proposals or nancial realism.

be clear about expectationS. I the proposal depends on ree parking or marketing support rom the local

agency, it is important to state this explicitly.

provide optionS. When issuing the RFP, an agency is oten unclear about what it actually wants,and what is reasonable to expect. It can be helpul to provide dierent options contingent

on dierent levels o support, or to make expansion conditional on the achievement o certain utiliza-

tion thresholds.

Many local agencies will seek assistance in crating the scope, which in turn provides an opportunity

to make sure expectations are reasonable on both sides. However, there are oten detailed local

regulations precluding contact between potential bidders and procurement sta.

npf SsSecuring non-prot status is a relatively simple process i you have good advice, especially now that

City CarShare has paved the way. We strongly suggest working with a lawyer who has extensive

experience in non-prot law. The initial expense will pay o tenold in the long run.

A scal sponsor can be a tremendous help in the early months beore receiving ocial non-prot

status. Usually or a small ee, they will eectively lend their status and act as an umbrella organi-

zation or other projects. In this way, a fedgling group can accept donations that are tax-deductible

beore being recognized by the IRS.

For detailed step by step guide to incorporating as a non-prot, check Nolo Presss book,How to Form a 501c(3) Nonprot Corporation.

mes Sccess

Perormance measures are important or several reasons:

At the organization-wide level, they help identiy the strengths o a car-sharing operation,

and areas or improvement. When reported at the vehicle or pod level, they can identiy

underperorming locations and allow corrective action to be taken.

They make it easier or Board members and advisers to provide useul input.

They may be required as a condition o unding. This is particularly likely or government

agencies, but can also be benecial when compiling reports or private oundations, in that

they convey a greater degree o proessionalism and rigor.


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There are two broad groups o perormance measures: those that measure internal eciency, such

as ull-time employees (FTEs) per vehicle; and those that ocus on external impacts, such as savings

in vehicle travel.

Measures o Internal Eciency

number of memberS and vehicleS. These are basic measures o the organizations size and rate

o growth.

utilization rate. This is the number o revenue hours per day a vehicle achieves. An alternative, similar

measure is revenue per car. These are the most important indicators o pod viability and an organiza-

tions nancial health, and should be reported separately or each pod, or each geographic subarea,

and or the feet as a whole. It is equally important to establish the utilization rate which is needed

or a pod to break even (i.e. cover its direct costs, which with the exception o gasoline are generally

xed). Above this breakeven level, the pod will begin to contribute to overhead.

retention rate. This is a measure o member turnover, and helps to indicate the overall quality

and useulness o the service.

net neW memberS per month. This is a basic measure o the eectiveness o marketing eorts.

fixed: variable coStS ratio. Variable costs are car costs such as maintenance, insurance and uel that

vary with feet size. Fixed costs are sta, rent, marketing and other overhead. Over time, an orga-

nization should become more ecient, meaning that the ratio o xed costs to variable costs will

go down.

Staff: vehicle ratio. This is another measure o internal eciency. The ratio should go down over time

as an organization expands.

farebox recovery ratio. This reers to earned revenue as a percentage o total costs, and is a measure

o nancial sel-suciency. Farebox recovery is a common measure o perormance in the transit

industry, and will be intuitive to transportation sta in public agencies.

member: vehicle ratio. While this is not necessarily an indicator o eciency, it is important to track

in order to understand changing patterns o usage, and or budgeting and planning purposes.

Measures o External Impacts

These perormance measures should be related to the mission and goals o a car-sharing organiza-

tion. The exact measures used will depend on the data available, which will generally require member

surveys or reerence to existing published work (see Chapter 1). Some examples include:

Percentage o members who have sold cars


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Number o cars taken o the streets

Number o auto trips or amount o vehicle travel saved

Number o new transit trips, or amount o transit agency are revenue increase

Tons o emissions reduced

Percentage o members who are low-income

Number o parking spaces saved in new developments incorporating car-sharing


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ChaPtEr 4:

rECruiting thE right PEoPLE

te Bd Decs

The Board o Directors is or should be one o a car-sharing organizations greatest assets. As with

any other organization, it provides strategic oversight and direction, approves the budget, and sets

key policies such as expansion criteria or a new pod.

To be successul, however, a car-sharing organization needs to work closely with numerous pub-

lic and private sector partners, such as cities, transit agencies and developers (see Chapter 5).

This means that the Board has a ar wider role in developing active partnerships, and maintain-

ing the goodwill and support o these organizations. Board members can be an operators mostimportant asset in reaching out to elected ocials, key sta in cities and transit agencies, and grass-

roots organizations.

Board members, thereore, should be recruited partly or their specialist skills and knowledge such

as nance, real estate, technology and transportation planning but also or their ability to open

doors within key agencies. I an agency or developer is represented on the Board, it is ar more likely

to buy in to the mission and goals o car-sharing, and serve as a champion within their respective

organization. In turn, their presence on the Board will help to ensure that car-sharing is managed

in a way that ocuses on social and environmental goals, such as boosting transit ridership. Board

members drawn rom the business community, meanwhile, can provide a valuable way to recruit

new business members.

For small operators in particular, Board members can also provide a signicant amount o volunteer

labor in specialist roles. Much o this detailed work may best be perormed in committees. For exam-

ple, one committee might ocus on nance, another on human resources, and a third on operations.

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r

ECrui ti ng

thEri ghtP

EoPLE

Sta

There are several distinct unctions that need to be perormed. For smaller operators just starting

up, one sta person is likely to take responsibility or several o these unctions. At larger operators,

these may be in teams. Precise job descriptions will depend on individual skills and the size and

ocus o an individual operator, so the ollowing descriptions are intended to indicate the specic

tasks that will need to be undertaken.

Inormal car-sharing operations, with just a couple o vehicles, can be run by volunteers. However,

ull-time stang, with a minimum o two employees, is essential or any organization with grander

ambitions. It is easy to underestimate the amount o sta time that is required, even to deal with

seemingly straightorward issues such as procuring parking spaces.

general manager/executive director. This individual will provide overall management and leadership

or the operator. He or she is also likely to take the lead in developing partnerships with govern-

ment agencies, unders and businesses, and may also be responsible or expansion planning.

Key skills include organization, long-term vision, the ability to inspire employees and allies, and

boundless energy.

operationS/fleet management. This person is responsible or ensuring that vehicles are in the right place

at the right time, and are maintained in excellent condition. Responsibilities include negotiating vehi-

cle leases or other acquisitions, insurance, balancing vehicle numbers with demand in a particular

pod, procuring parking or new pods, and arranging cleaning and maintenance o vehicles. Key skills

include organization, negotiation/communication, and the ability to multi-task.

cuStomer Service. This person will be the public ace o the operator or most members.

He or she will process applications, answer questions, conduct orientations, solve member prob-lems, and maintain the member database, and may also provide administrative support. Key skills

include a riendly attitude, patience, creativity, fexibility and communication.

marketing. The marketing manager is responsible or getting the word out about car-sharing,

and implementing outreach strategies to potential members. He or she will also manage media rela-

tions. Key skills include excellent written and oral communications, creativity, the ability to connect

with lots o dierent people, and negotiation.

finance. Core responsibilities here include budget preparation, accounting, billing and dealing

with bad debt. This person may also assume a wider role in undraising, business planning,

and monitoring the perormance o dierent pods. Key skills include organization, creativity, anda balance o long-term vision and short-term practical decision-making.

Human Resources.As an organization grows, ormal human resources policies become increasingly

important. Invest in time with an HR expert to make sure your personell policies are comprehensive

and ully legal. Issues such as overtime, comp time, vacation, personal leave, injury, sta confict,

compensation, maternity leave, and o course ring and hiring will come up sooner than you think.


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technology. This may be managed in-house, or outsourced. Technology is in some ways the key

piece to having a sel-sucient car-sharing organization, however, every location and organization

is dierent. For urther inormation on this topic, please call City CarShare to speak with our

Executive Director.

on-call Service. All car-sharing operators require 24/7 on-call service, to handle emergencies suchas late returns or the vehicle parked in the wrong place. Providing stang round the clock, however,

is extremely dicult. While most small operators rotate this unction around sta, using cell phones,

this becomes burdensome in the long run. Alternatives include employing dedicated on-call sta,

or using a call center to screen problems and answer common questions.

A car-sharing organizations sta can be its greatest asset, contributing immensely to the sense that

car-sharing is un. At City CarShare, the sta receives rave reviews rom members or their good

humor, and willingness to go beyond the call o duty. However, proessionalism is essential. Make

sure you hire employees who understand both sides o the organization: a social change project

as well as a customer-service oriented business.

Volunteers

Nonprot and cooperative car-sharing organizations oten benet rom a signicant amount o vol-

unteer labor, and pro bono work. Nurturing these relationships and making good use o volunteers

can be a critical component o the organization. Volunteers can be rewarded in kind through a credit

or each hour worked. Its important to put eort into training and maintaining your volunteers.

Organizations that do not prioritize the care and eeding o volunteers soon nd that their support-

ers leave, eeling unappreciated or not well-used.


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B

ui LDi ng

Par

tnErShi PS

ChaPtEr 5:

BuiLDing PartnErShiPS

Wy D Y need Pes?

Car-sharing rarely succeeds in isolation. Virtually every successul operation has been built with the

active participation o partner organizations, such as transit agencies, parking authorities, and cities.

Partners can oten provide:

Funding, either or general operating support or specic projects

Parking ideally ree or discounted

Advertising space and other publicity ideally ree or discounted

Integration with transit, such as through providing parking at transit hubs and joint marketing

Promotion to a partner organizations clients, such as transit riders

Zoning incentives and other planning policies to include car-sharing in new developments

Without this support, car-sharing would not necessarily be impossible, but it would be a signicantly

more expensive and dicult proposition.

Key Pes rec

Figure 14 shows some o the key partners that are valuable or virtually any car-sharing opera-

tor. Dierent local governments are organized in dierent ways, and so the precise department

with responsibility or an issue will vary rom place to place.

Another valuable contribution that all o these potential partner organizations can oer is to join

as a business member. As well as providing revenue, and helping to contribute to environmental

objectives, this can serve as a catalyst or other organizations to join. While many o these partnerorganizations will be small, others can provide a major boost to a car-sharing organizations mem-

bership. The cities o Philadelphia and Berkeley, or example, are providing employees with access

to car-sharing as a cost-eective alternative to expensive city feets.


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Figure 14: PotentiaL Partner organiZationS

Partner Organization What Can They Provide?

local/regional public agencieS

Local jurisdictions

(cities, counties, etc.)

Funding

Incentives/requirements or car-sharing in new

development (e.g. reduced parking requirements

or developers)

Publicity

Planning and other technical assistance

Help securing parking

Giving car-sharing legitimacy, through

the ocial stamp o approval

Support when developing partnerships

with other organizations

Parking authorities

(usually part o local government)

Funding


Transit agencies

Funding

Parking at transit stations ideally ree or dis-

counted

Publicity, marketing and promotion to transit

riders (e.g. on transit vehicles, in stations andon the website)

Integrated ticketing (e.g. providing a car-sharing

add on to a transit pass)

Metropolitan Planning

Organizations

Funding these organizations oten allocate

(program) transportation unding in major regions


Rideshare/Transportation Demand

Management Agencies

Promoting car-sharing to their member organiza-

tions or clients

Publicity and marketing

Social service providers Providing or subsidizing car-sharing to their clients

Other public sector agencies

(e.g. public utilities, air quality

regulation agencies)

Funding

Marketing


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B

ui LDi ng

Par

tnErShi PS

private/nonprofit organizationS

Developers

Parking in new developments

ideally ree or discounted

Underwriting start-up costs Providing ree memberships to tenants

Marketing to tenants

Universities/colleges

(may be public sector)

Funding


Marketing to students, sta and aculty


Oce/business parks Parking ideally ree or discounted

Marketing to tenants

Foundations Funding

Community/advocacy groups Political support

W d Pes g re?

I partner organizations are to provide this level o support, what do they gain in return? How can

they be motivated to support car-sharing? There are three main areas where they benet, the relative

weights o which will depend on the type o organization.

public policy goalS. As discussed in Chapter 1, car-sharing brings substantial social and environmental

benets, such as reduced trac and parking demand. Many public agencies have a similar mission

and goals, which car-sharing can help support. For example, car-sharing can help a transit agency

boost ridership, or an air quality regulation agency reduce emissions. Supporting car-sharing also

helps support an organizations environmental image, and provides that intangible eel good actor,

being part o an innovative solution.

coSt SavingS. Each parking space in a major urban area can cost $20,000-$50,000 per space or more

to build. When all costs land, construction, design, nance and operations are considered, aver-

age costs are $83 per month or a surace lot, $163 or a parking structure, or $290 or underground

parking. These costs are signicantly higher in major urban cores, and are rarely ully covered by

parking charges, i they exist at all. This means that it is usually cheaper or developers and cities to

reduce the demand or parking by introducing car-sharing, rather than build new parking acilities.


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amenitieS. Many developers have sought to introduce car-sharing into their projects, because it adds

value and provides an amenity to their tenants. Car-sharing also provides a benet or employees,

and or tenants o oce parks or similar developments.

Wk w Develpes

The partnership between developers and car-sharing operators can yield major rewards or both

sides, and is worthy o more detailed discussion. Car-sharing can be o great value to developers;

by incorporating car-sharing in their projects, developers can secure fexibility in parking require-

ments, mitigate trac impacts, and otherwise expedite permit approval and reduce development

costs. The availability o car-sharing can also reduce the amount o parking required, and attract

tenants, particularly i membership is bundled with the cost o an apartment.

In return, developers are oten willing to provide ree parking, marketing to their tenants, and under-

write memberships or tenants and the start-up costs o a new pod. These start-up costs includesignage, web programming and other capital outlays, and the operating subsidy or the ramp up

period necessary beore the vehicle starts earning enough revenue to pay or itsel. Developers may

also pay or application ees and monthly membership charges or their tenants. With eective mar-

keting, penetration rates can be ar higher than in the surrounding neighborhood.

As a car-sharing organization grows, it becomes important to present a consistent deal to dierent

developers. It may be helpul to develop a standard contract or Memorandum o Understanding,

which outlines expectations on both sides. An organization will also need to explore various avenues

that can be used to reach out to local developers, such as:

Local planning departments, and any housing advocacy groups. Planning sta may suggestcar-sharing to applicants as a matter o course particular where local planning documents

advocate or the expansion o car-sharing. Planning codes may also be revised to encour-

age or require the inclusion o car-sharing.

Housing development conerences and other networking opportunities.

Through transit oriented development programs. Car-sharing may be included in best prac-

tice guidelines and criteria or project selection and unding.


41/66

o

utrEaChanDmarKEti ng

0

ChaPtEr 6:

outrEaCh anD marKEting

The core purpose o outreach and marketing is to convince people to join. Some will be backgroundmarketing, designed to improve overall awareness o car-sharing and make it more likely that they

will join at trigger points such as moving to a new home. Other outreach eorts can be extremely

targeted or example, to support the opening o new pods, and increase revenue at lightly used

pods. Outreach and marketing also has an important role in building political and community sup-

port or car-sharing.

Outreach and marketing should be based around a consistent branding and identity. The logo should

be developed with consistent guidelines as to usage and positioning, and the business or marketing

plan should identiy key messages designed to appeal to the target audience. Some messages used

by dierent car-sharing operators include:

The reedom o driving without the hassles o ownership (City CarShare)

Wheels when you want them (Zipcar, Boston)

Our wheels. Your reedom (Philly CarShare)

The smarter way to drive (I-GO, Chicago)

The care-ree automobile (CommunAuto, Quebec)

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a d, l c m d bd ps s M W advs: isp

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Background MarketingThe car-sharing operators vehicles and members are its two most important marketing assets.

Most people hear about car-sharing through a riend, by seeing a car, or by reading about it in the

newspaper. In order to continue to generate this avorable marketing, an operator needs to:

Keep vehicles clean and in good condition


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Provide excellent customer service

Ensure that vehicles and pods are clearly branded, maximizing car-sharings visibility

Website

Ater the cars, the website is the most important public ace o the car-sharing organization

or members, and potential members. As well as hosting the reservations system (see Chapter 7),

it needs to provide quick, simple answers to common questions rom potential users. Typical sec-

tions include:

How does car-sharing work?

Where are the vehicles located?

How much does it cost? (Many operators also include a motoring cost calculator,

to allow easy comparisons.)

What are the benets?

Sta and Board biographies

Acknowledgements o support rom unders and other partner organizations

g s -s wss :

www.ccs.www.pllcs.

www.s.cm

www.zpc.cm

www.cmm.cm/d_eng.ml

www.cpv.

www.fc.cm

Marketing to Individuals

Larger car-sharing organizations may have the resources to undertake extensive marketing cam-paigns, or example by purchasing advertising space on transit vehicles, in newspapers, and at bus

stops. Smaller operators, however, will need to concentrate on more ocused outreach around pods,

particularly in the run-up to a pod opening. Useul techniques include:

Doorhangers distributed around each pod

Articles or advertisements in neighborhood newspapers
http://www.citycarshare.org/http://www.phillycarshare.org/http://www.autoshare.com/http://www.zipcar.com/http://www.communauto.com/index_ENG.htmlhttp://www.communauto.com/index_ENG.htmlhttp://www.flexcar.com/http://www.flexcar.com/http://www.communauto.com/index_ENG.htmlhttp://www.communauto.com/index_ENG.htmlhttp://www.zipcar.com/http://www.autoshare.com/http://www.phillycarshare.org/http://www.citycarshare.org/


43/66

o


Press releases or media opportunities (see below)

Postcard mailings to local residents. Mailing lists can be borrowed rom supportive partner

organizations, or purchased rom commercial mailing lists

E-mails to potential members who have expressed interest

Presentations to neighborhood organizations and merchant associations

Articles and signs in merchant windows

Locating a vehicle on a major street in a new pod neighborhood and distributing fyers

Tabling at neighborhood events and street airs

When to Turn a Member Away

In general, any car-sharing operator should welcome any prospective member with open arms.

However, it is important to run a driving record check beore approving an application, to ensure that

members are likely to drive saely. This helps to screen out drivers who are most likely to be involved

in an accident. The cost o the check which is oten at least partially recouped through application

ees is saved many times over in the long run through lower insurance premiums.

People Moving Home

Vehicle ownership is characterized by a great deal o inertia. Once a household has made the deci-

sion to own a certain number o cars, they tend not to reevaluate this except at key decision points

such as changing job, when the vehicle needs major repairs, or moving home. This means that

new residents moving into a neighborhood represent a good marketing opportunity. Some specic

channels may include:

Realtors and property management agencies may want to highlight the provision o car-

sharing nearby in their sales pitches or inormation to potential renters, in the same way as

they advertise transit services and local shopping

Neighborhood associations may be willing to publicize the availability o car-sharingin welcome packets or other materials or new residents.

The Change o Address service rom the US Postal Service


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Retaining Members

Retaining existing members is almost always more cost-eective than recruiting new members.

Some degree o member attrition is inevitable people will move out o the area, nd a new job

that requires commuting by auto, or simply nd that they dont use the service enough to make

it worthwhile. An exit survey, however, is essential in helping an organization to understand whether

any service improvements would help reduce attrition rates.

Marketing to Businesses

Businesses are an important part o the customer base or car-sharing. Peak usage or business

members is during the weekday, while individual members use the cars most at evenings and

weekends. Businesses thereore help to even out the demand cycle and increase utilization rates.

This also means that the marginal cost o providing services to businesses close to existing pods

is extremely low.

The benets that car-sharing can provide a business member will vary by organization, and the sales

pitch will need to vary accordingly. Some will be drawn by cost savings and administrative ease,

some by the quality o the vehicles, while others may see membership as a way o boosting their

corporate social responsibility and environmental image. Some o the businesses that have proved

most likely to join include:

Small consulting rms, particularly in the architecture and engineering eld, and other high-

value service proessions with a need to visit clients or sites. Trade associations or these

businesses may be a ertile recruiting ground.

Nonprot organizations

Government agencies (see Chapter 5)

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med rels

Local newspapers, television stations and other media outlets can be a car-sharing organizations

greatest asset, providing a huge amount o ree or earned publicity. Car-sharing still has all the ingre-

dients or a great story. It is new and innovative particularly in cities that do not yet have service.

The ounders are oten local entrepreneurs or community activists, providing the human interest


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o


element. And it concerns transportation and congestion, one o the bread-and-butter issues or local

media. Oten the cars and members provide a good photo opportunity, especially i you choose

hybrids or another interesting model o vehicle, such as a Volkswagen Beetle or Scion.

There are many milestones

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Bringing Car SHaring to Your Community (CityCarShare 2004)

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