Autolib Lessons Learned?
When is a failure not a failure? When it occurs in France.
Ever since the arrival of Zipcar more than 10 years ago, the concept of car sharing has become increasingly compelling. Launched not long after Zipcar, which is now owned by Avis, Autolib promised Parisiens liberation from car ownership. That liberty was short-lived as losses mounted at Autolib and the government refused to offer a bailout. The company reported high approval ratings and utilization, but the mayor of Paris said: "No, merci!"
There are many fundamental reasons for the failure of Autolib some of which are specific to Autolib and some of which are emblematic of the challenges facing the car sharing sector overall. The Autolib-specific factors include such elements of the program as its station-based business model, its single vehicle type offer, the lack of an efficient and effective process for cleaning the cars, and an inability to triage under-performing station locations.
Other complaints unique to Autolib included an insufficient number of cars to serve an estimated subscriber base of more than 100,000 and the fact that the fleet itself was aging. Factors that were beyond the influence of Autolib to correct or mitigate included the emergence of competing transportation alternatives in the form of inexpensive and on-demand ride hailing and, to some extent, the growing prevalence and availability of bike and scooter sharing options.
It is sad news for Paris and Autolib and the industry as a whole, but it highlights challenges in the form of business models and a supporting eco-system that remain for car sharing service providers. The failure of Autolib also shines a bright light on successful operators of car sharing programs elsewhere in the world including Seattle, Madrid and, well, nearly every large city.
While car sharing service providers may be losing money elsewhere in the world, few are or were losing money at the pace of Autolib, which was foreseen racking up nearly 300M Euros in total losses by 2023. Market research shows that car sharing services offer a wide range of positive impacts relevant to reducing emissions, congestion and, to some extent, private vehicle ownership and usage.
London's car sharing association, in particular, has shown in its member surveys that participants in car sharing programs tend to shed cars - and not just any cars but generally older, less fuel efficient and more polluting cars. Multiple studies have shown that a shared car reduces vehicle ownership or purchases of as many as 9-13 other cars.
Local and federal governments are increasingly embracing the vested interest in car sharing as an all-encompassing transportation corrective. The Autolib failure, though, may suggest a more active role for municipal governments in subsidizing or sponsoring car sharing services.
By allowing car sharing providers to operate and allocating resources appropriately while also allowing ride hailing services and the like, municipal leaders have moved beyond the invisible hand of organic demand. The approval of a car sharing program and its market introduction is an active market intervention which makes local authorities interested parties implicated in the long-term success of the service.
By the same token, car companies that have invested in or launched their own car sharing services have a responsibility to promote these alternatives to vehicle ownership, even if these efforts appear to contradict the fundamental objective of selling cars and fostering ownership. No car maker has yet found a way to thread this needle - promoting ownership and sharing simultaneously. This is too bad because the time will soon arrive when all cars are sharable thanks to existing connectivity technology.
The advantage a car maker has in promoting car sharing is the potential to offer a range of vehicles suitable to different applications or local market requirements - as well as the ability to rotate new cars into the mix on a regular basis. New car dealers, too, have this advantage. One of the key points of failure for Autolib was the lack of vehicle variety and the growing age of its vehicle fleet.
Ultimately, Autolib's failure will serve as a cautionary tale for current and new car sharing players. Keep your cars clean. Regularly refresh the vehicles in your fleet. Constantly evaluate the size of the fleet and the availability of vehicles relative to local demand. Opt for free floating over station-based systems. Find ways to stimulate or subsidize demand in a competitive transportation environment where cheaper, more convenient alternatives may exist.
Lessons learnt: "Keep your cars clean. Regularly refresh the vehicles in your fleet. Constantly evaluate the size of the fleet and the availability of vehicles relative to local demand. Opt for free floating over station-based systems. Find ways to stimulate or subsidize demand in a competitive transportation environment where cheaper, more convenient alternatives may exist." Having tested Autolib a few years back I can attest to #1 and #2. No Carshare in North America would have survived with the state Autolib's fleet was in. But then again, cleanliness and how people treat what's perceived "public property" is culturally very different.
Is there any evidence that shows free floating only? What about the combination in one company?
Confidential
6 年Simple Solution. Read my latest post.
Confidential
6 年As predicted: Scooter Sharing = Scooter Dumping. Bike Sharing = Bicycle Dumping. Car Sharing = Car Dumping.
Mechanical Engineer - Biogas Specialist - Python Developer
6 年Great article! Many lessons, difficult challenges... Free floating over station-based systems is great, but for electric vehicles it is complicated to manage if they are left far from the charger...