Posted on: Saturday, September 25, 2004
High cost of owning vehicle drives up demand for car-sharing services
By Allison Linn
Associated Press
SEATTLE — Facing rising gas prices, high insurance costs and hefty parking fees, Seattle resident Shana Lehar came to one inevitable conclusion: She simply couldn't afford to own a car.
Ted S. Warren • Associated Press "It just sounded like a really good deal," said Lehar, who lives in the urban Capitol Hill neighborhood and expects to use Seattle-based Flexcar several times a month.
Thousands of urbanites seem to agree. Car-sharing programs across the country say business is booming, as more and more city dwellers are balking at the cost of car ownership and looking for alternatives.
Seattle's Flexcar, which operates in more than 20 cities, has seen membership grow to 22,000, from 16,000 a year ago. Zipcar, which operates in Boston and elsewhere, says business is up 90 percent in a year, to around 25,000 participants as of August.
Rising gas prices have been a great boon for drawing people to consider car sharing, said Eliot Dobris, spokesman for San Francisco's City CarShare, a nonprofit service that has more than 3,000 members. But Dobris thinks it takes a combination of financial factors to get them to sign up.
Scott Griffith, chief executive of Zipcar, said many new members cite rising parking fees and insurance costs. He says car-sharing programs are also becoming more popular simply because more people are aware of them.
A bad economy, or just a slow recovery, also can be good for the car-sharing business.
"We tend to be a little bit countercyclical, so as things get worse for consumers, they tend to look for alternatives to save money," said Lance Ayrault, chief executive of Flexcar.
There are also personal circumstances that draw people to car sharing.
Michelle Bourassa of Kirkland, Wash., needs to sell her car after a recent divorce. She has arranged a ride to work but expects she'll use Flexcar for doctor's appointments and when there is no other way to get her daughter to school. Still, Bourassa is hoping she'll be able to save up enough to buy another car soon.
Businesses are getting into the car-sharing game, too. Flexcar's business customers include Starbucks Corp. and the North American offices of Nintendo.
Car-sharing services work like this: In exchange for hourly and-or mileage-based fees, the service generally foots the bill for everything from gas to tuneups to insurance. Most rely on 24-hour phone and Internet reservation systems and park cars throughout a metropolitan area for pickup and drop-off.
Fees vary depending on the city and the type of service. Flexcar's Seattle service charges a flat fee of $35 a year. After that, users can pay $9 an hour for up to 30 miles, or opt for monthly plans. To use a car for 25 hours and up to 750 miles would cost $200, for example.
But Lehar, 23, didn't want to give up the occasional ride to the grocery store or trip to the beach. So she became one of thousands nationwide to sign up for a car-sharing program, which promises easy occasional access to a car for a fraction of the cost of actually owning one.
David Shaw, who works with nonprofit organizations, enters his PIN on a keypad of a Flexcar vehicle in Seattle. Many urbanites find that car-sharing programs are more economical than owning a vehicle.
