🔗 Share this article

A community kitchen in Rotherhithe has distributed hundreds of cooked meals each week for the past two years to elderly residents and needy locals in southeast London. Yet, the group's plans face major disruption by the announcement that they will not have use of New Year’s Day.

The group had relied on Zipcar, the app-based vehicle rental service that customers to access its fleet of vehicles via smartphone. It caused shock across London when it said it would cease its UK operations from 1 January.

This means many volunteers will be unable to collect food from the Felix Project, that collects excess produce from supermarkets, cafes and restaurants. Other options are less convenient, costlier, or do not offer the same convenient access.

“It’s going to be affected massively,” stated Vimal Pandya, the project's founder. “My team and I are worried about the logistical challenge we will face. Many groups like ours will face difficulties.”

“Faced with this reality, everyone is concerned and thinking: ‘How will we continue?’”

A Major Blow for Urban Car-Sharing

The community kitchen’s drivers are among over 500,000 people in London registered as car club members, now potentially left without convenient access to vehicles, avoiding the burden and cost of ownership. Most of those members were probably with Zipcar, which held a dominant position in the city.

The planned closure, subject to consultation with staff, is a serious setback to hopes that car sharing in urban areas could cut the need for private vehicle ownership. However, some experts have noted that Zipcar’s departure need not spell the end for the idea in Britain.

The Promise of Car Sharing

Car sharing is prized by many urbanists and environmentalists as a way of mitigating the problems associated with vehicle ownership. Typically, vehicles sit as two-tonne dead weights on the side of the road for the vast majority of the time, using up space. They also require large CO2 output to produce, and people without a vehicle tend to walk, cycle and take transit more. That benefits cities – reducing congestion and pollution – and boosts public health through more exercise.

What Went Wrong?

The company started in 2000 before its acquisition by the American rental giant Avis Budget in 2013. Zipcar’s UK revenues were minimal compared with its owner's overall annual revenue, and a deficit that reached £11.7m in 2024 gave no reason to continue.

The parent company stated the closure is part of a “wider restructuring across our global operations, where we are taking deliberate steps to simplify processes, improve returns”.

Its latest financial reports noted revenues had declined as drivers took fewer and shorter trips. “This trend reflect the ongoing impact of the economic squeeze, which continues to suppress demand for discretionary spending,” it said.

The Capital's Specific Challenges

However, industry observers noted that London has specific problems that made it much harder for the company and its rivals to succeed.

• Patchwork Policies: With numerous local councils, car-club operators face a mosaic of different procedures and prices that made it harder.
• New Costs: The closure coincides with electric cars start paying London’s congestion charge, adding extra expenses.
• Unequal Parking Fees: Locals in some boroughs pay as little as £63 for a year’s electric car parking permit. A floating car club would pay over £1,100 annually, creating a significant barrier.

“We should literally be charged one-twentieth of a resident’s permit,” said Robert Schopen of Co Wheels. “We’re taking cars off the street. We’re putting less polluting cars in their place.”

A European Example

Nations in Europe offer models for London to follow. Germany introduced national car-sharing legislation in 2017, providing a unified system for parking, subsidies and waivers. Now, the country has several shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK lags behind at 0.7.

“What we see is that car sharing around the world, particularly on the continent, is expanding,” commented Bharath Devanathan of Invers.

Devanathan said authorities should start to treat car sharing as a form of mass transit, and integrate it with train and bus stations. He added that one unnamed client was already seriously considering entering the London market: “There will be fill this gap.”

The Future Landscape

The company’s competitors can be split into two models:

1. Fleet Operators: Which maintain their own cars. This includes Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Peer-to-Peer Services: Which allow users to hire out their own vehicles via an app – similar to Airbnb for cars. Players include Britain’s Hiyacar and the US’s Getaround and Turo.

One company, a US-headquartered peer-to-peer platform, is assessing the UK gap. Rory Brimmer, its UK head, said there was a “significant chance” to win more users. “There is a void that is going to need to be filled, because London still needs to move,” Brimmer said.

However, it could take some time for other players to build momentum. For now, more people may choose to buy cars, and others across London will be without a convenient option.

For Rotherhithe community kitchen, the next month will be a rush to find a solution. The logistical challenge caused by Zipcar’s exit underscores the wider implications of its departure on community groups and the future of car-sharing in the UK.