Car Sharing and its Impact on the Automotive Sector


Term Paper, 2021

15 Pages, Grade: 2,0


Excerpt

Table of contents

List of Abbreviations

List of Figures

1 Introduction

2 Car Sharing definition

3 The Car Sharing movement
3.1 The technology progress
3.2 Sustainability
3.3 Affects of Corona Pandemic and prospect

4 Impact of Car Sharing on the automotive sector
4.1 Opportunities
4.2 Challenges

5 Conclusion

Bibliography

List of Abbreviations

CS Car Sharing

UITP Union Internationale des Transports Publics

NMS New Mobility Services

List of Figures

Figure 1: CarSharing separated according to varieties

Figure 2: Impact of CS on the new and used car market

1 Introduction

Car sharing in 2021 is no longer a new invention, but rather part of the social shift toward a sustainable world. It is the breaking down of old values of owning a car as a status symbol. Thus, car sharing (CS) has its origins in 1997, when the cooperatives ATG AutoTeilet Genossenschaft and ShareCom merged to form the swiss Mobility Genossenschaft, bringing together the first thoughts on car sharing (cf. Mobility Genossenschaft, n.d.). The intention was to make it possible for all people to use a car, especially those who cannot bear the high costs of purchasing and maintaining one.

Now, a lot has happened in the project for over 20 years, with the last 10 years in particular bringing a great surge in development. Digitization and the progress of technologies have managed to generate a wide reach and market the sharing model as a worthwhile business model. Worthwhile for companies and users alike, who can now reserve and use a car close to them with little money and pay for it for a leisure trip, a trip to the supermarket or a commute to work only as long as it is in use. This is a sensation in view of the rapidly growing world population, which is causing major traffic problems, making cities ever more crowded and cramped, and leading to unimaginable environmental problems through the independent ownership of cars.

Yet cars are only used about 5% of the day (Morris, 2016).

The automotive industry, meanwhile, is delighted about the growing middle class, which nowadays can afford its own car without major restrictions and also wants to. Cars mean the greatest possible mobility, freedom for people. Although this is a basic human need, awareness of sustainability and climate protection has increased. As a result, the automotive industry is currently under unprecedented pressure to transform its technologies to electric drives and to decide on its own market position in a future-oriented manner, to be a mobility service provider or a pure vehicle manufacturer.

At the present time, CS is largely offered by companies that mediate supply and demand and thus connect users with automobiles. BMW and Daimler, which have been mobility service providers and CS suppliers for several years, can be named as an exception here. (Petereit, 2019). However, since several people now share a car, it is reasonable to assume that the sales of automotive suppliers will decline - provided that CS continues to gain acceptance and experiences exponential growth in the following years.

What exactly CS is and if, respectively which effects the automotive industry will experience due to CS, will be examined in more detail in this thesis.

2 Car Sharing definition

From the umbrella organization Bundesverband CarSharing e.V., CS is described as an organized and shared use of motor vehicles (cf. n.d.). However, it is not just sharing the use, but much more sharing the cost of the motor vehicle that drives most people to change. It's also sharing the mindset of living together sustainably and using resources efficiently while still retaining the positive aspects of a car.

Arthur D. Little, in cooperation with the Union Internationale des Transports Publics (UITP), defines it as follows: “Car-sharing is based on the simple idea of being able to use a car individually without having to own one but in a way that is just as convenient. It’s an innovative local mobility service complementary to public transport.“ (Little, 2018) CS is available in free-floating, station-based, and a combination of both, and is represented both in major cities and their surrounding areas. Both variants are experiencing high growth in new customers, with the free-floating model being the faster-growing and more pronounced model in Germany, but at the same time the less environmentally friendly model. (cf. Statista, 2021). This is only represented in major cities, while station-based CS is the much more nationwide model with over 1.000 locations across Germany.

Figure 1 : CarSharing separated according to varieties

Abbildung in dieser Leseprobe nicht enthalten

Source: Bundesverband CarSharing e.V., CS varieties, 2020

3 The Car Sharing movement

As described in the introduction, CS is experiencing ever-increasing demand. Starting with helping out neighbors, through organized associations for commuting to work, to a rapidly expanding company such as Uber Corporation, as an international online brokerage service for passenger transportation, and Share Now GmbH, as the largest German CS provider in the free-floating concept (cf. Bundesverband Carsharing e.V., 2020).

Thus, the Internet of Things is the optimal platform to connect all users, to utilize the vehicles in the best possible way, and thus to make the offer financially attractive.

3.1 The technology progress

While it is not essential for sharing cars to develop advanced technologies that are independent of the car, these lay the foundation for a CS enterprise model. CS is only attractive to the large mass of people if it is easy to use, many users can access it simultaneously, and the costs incurred by its use are made transparent. Furthermore, the free-floating model in particular depends on showing users where available, functioning, and fueled cars are located. Also, access to the car must be granted to the user without first having to collect the key from the previous user. All of these are prerequisites for allowing the business model to develop and for CS to be integrated into society.

Until the beginning of the 21st century, there were no smartphones and no location-independent availability of the Internet, but now most people have their own smartphone with access to the Internet and software solutions for all areas of life. Smartphones are indispensable and for CS a particularly important tool for using the service. Thus, CS providers care about developing optimal digital solutions to experience a secure, transparent and convenient experience. Future-oriented technologies, such as autonomous driving, are currently still in development and will raise CS to a new level. Due to the limited scope of this work, it is not possible to go into this extensively. What can be said, however, is that with the completion of these technologies, cars can be used as efficiently as possible, since the cars no longer need a human driver and can be used continuously. From this a better sustainability, as well as possibility for the standardization of the CS can be concluded.

3.2 Sustainability

The term sustainability strongly refers to the ecological footprint of our behavior on earth. Since people have become aware of the finite nature of resources and science has advanced to the point where we know the effects of greenhouse gases on our planet's climate, all measures are being raised politically and through many (own) initiatives to make up for humanity's shortfall.

In the UK, for example, it has been mandatory since 2007 for CS providers to participate in the annual studies of the car sharing association Carplus and to provide figures from the company for scientific purposes (cf. Bundesverband Carsharing e.V., 2020). In 2014, it was found that around 45% of the CS users surveyed owned their own car when they registered, and that this had fallen to 20% by the time they took part in the study. At the same time, it was determined that a car used by CS replaces about 6.2 private cars, which amounts to 14.000 cars in London alone. In 2015, this figure had already been corrected to 10.5, while the annual mileage of users in a car had been reduced by about half (Bundesverband Carsharing e.V., 2014).

Zipcar, the world's leading CS company, which has been active since 2000 and already offers CS services in over 500 cities worldwide, receives evaluations from its surveys that say that CS not only often leads to car sales among users, but also generally stimulates people to move again. According to the website, one CS car replaces up to 13 private cars (cf. Zipcar, Inc., 2019).

The University of Hohenheim in Stuttgart, together with the British University Surrey Business School and the EBS University of Economics and Law in Wiesbaden, has shown that CS continues to promote the acceptance of electric cars and that conviction was even higher after using CS with an electric car than during a regular electric car test drive in a car dealership. For example, the Informationsdienst Wissenschaft e.V. writes that CS users had a much more positive attitude toward e-cars after the drive. They also wanted to recommend electric vehicles to others to a greater extent from then on. Even the intention to buy the vehicle brand used in the future increased among the respondents. CS therefore actively contributes to using resources more efficiently, freeing roads from cars, getting people to move more, traveling significantly less distance per year in cars overall, and creating greater acceptance for electric cars. The sustainable aspect of the CS is therefore clearly evident and represents a major contribution to improving the ecological footprint on the planet (cf. 2020).

[...]

Excerpt out of 15 pages

Details

Title
Car Sharing and its Impact on the Automotive Sector
College
University of Applied Sciences Essen
Grade
2,0
Author
Year
2021
Pages
15
Catalog Number
V1127801
ISBN (eBook)
9783346488336
ISBN (Book)
9783346488343
Language
English
Tags
Car sharing, Autonomous driving, Automotive sector, sharing economy, mobility, future mobility, mobile services, carsharing, car rental
Quote paper
Jan Bausewein (Author), 2021, Car Sharing and its Impact on the Automotive Sector, Munich, GRIN Verlag, https://www.grin.com/document/1127801

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