Car sharing won't muscle out vehicle ownership

NOVI, Mich. -- Maybe car sharing won't threaten the auto industry after all.

Despite forecasts from futurists that Millennials aren't that interested in owning cars and trucks, new vehicle sales are running at levels not seen since the housing bubble of a decade ago.

At the same time 1.3 million Americans belonged to some type of car-sharing network at the end of 2014, a 34% increase from 2013, according to the University of California-Berkeley's Transportation Sustainability Research Center.

In fact, a new twist on the car-share industry is also expanding: renting out your personal vehicle to strangers. It works much in the same way that Airbnb.com rents out your residence to travelers when you go on vacation. Getaround, a San Francisco-based vehicle-share program which launched in 2009, has expanded this year to Washington DC, Portland, Ore., and Chicago.

The simultaneous upswing for auto sales and car sharing can be partially explained by rethinking some faulty assumptions.

First, Millennials, now the largest demographic block in the U.S., are not abandoning car ownership. Those born after 1980 accounted for 27% of new vehicle purchases in the U.S. last year, up from just 18% in 2010, according to J.D. Power and Associates.

The second dubious assumption is that Generation Xers and Baby Boomers will be ensconced forever in suburbia, desperately dependent on their cars.

Last month, Zipcar, which is owned by Avis Budget Group, released a study that more people between 50 and 69 are moving to urban cores. Nearly 15% of Zipcar members are over 50, according to company president Kaye Ceille.

Antonio Agee, 44, of Detroit uses it regularly.

"I like immediacy. I can go straight to my app and say I want this car right now," said Agee, an artist who owns a 1967 Ford Econoline van. "I feel like I'm more in charge of what I'm doing."

He's belonged to Zipcar for nearly four years and is satisfied with the experience. He said he occasionally gets a car that been left with a messy interior, but he's never had an accident while using the service.

"I'm not a speedy guy," he said. "I don't even walk fast."

For now, a modest economic recovery is strong enough to spur both new vehicle sales and car sharing, especially in urban areas where residents of all ages are looking for ways to reduce the cost of owning multiple vehicles.

Susan Shaheen, director of Innovative Mobility Research at UC Berkeley, has studied car sharing nearly since its inception 20 years ago.

"There's more choice now," Shaheen said. "Young people can move to cities and use these new options. Or they can settle in suburban or rural areas and buy a car or truck."

Shaheen's research shows that one car-sharing vehicle used regularly throughout a week, eliminates the need for 15 privately owned vehicles.

Rather than resist that, however, several automakers are looking at ways to incorporate the concept into a profitable opportunity.

"We are working on getting automakers to think beyond the one to one retail idea and embrace the one to many model," said Zipcar's Roberts.

Last month Ford launched GoDrive, a one-way car sharing service in London, much like the car2go program through which Daimler deploys a fleet of Smart cars to urban centers.

Ford regards GoDrive as a "beta" test. The service makes about 50 Fiesta subcompacts and Focus EVs available to about 2,000 people at 20 locations around London.