Wheels to rent: the future of transportation

Saving money while reducing congestion and environmental impact, the alternatives to traditional car ownership in New Zealand are growing.

After an unhelpful experience with a rental car company, Auckland-based American student Howard Hughes switched to the peer-to-peer car sharing service YourDrive. He found it a handy way to get around, connecting with locals who rent their vehicles to users of the YourDrive app.

Oscar Ellison; founder of YourDrive

Oscar Ellison, founder of YourDrive

“I’m studying in Auckland and my friends and I like to get out of the city during the weekends, and it’s hard to do that without a car,” he says. “Renting the car for only the day can be quite difficult to do with conventional car rental. I don’t think Uber or a taxi could give us the freedom that we wanted.”

The company, which celebrated its third birthday in April, had investment from van rental company Jucy in late 2016 to help it expand into tourism. Cars in the system range from ‘experience’ vehicles like a 1967 Ford Falcon or a cool Tesla Model S to more prosaic moving vans or station wagons for loading up.

Particularly appealing to Hughes and his friends was that YourDrive connects users and hosts (car owners) directly. Each party sees and rates the other, there are a variety of vehicles to choose from and issues can be handled immediately.

“It’s nice to deal with a person, rather than a whole company, to sort any problem that arises,” he says. “It’s an affordable alternative to full car ownership, since you are only paying when you use the car.”

Plenty of users agree. YourDrive founder Oscar Ellison says some 600 vehicle owners (up from 400 in 2017), and 4,000 drivers have used the service. Users are renting cars from owners to fill the niche between public transport, cycling and an Uber trip. Journeys can be anything from a couple of hours to a weekend, or even up to a month.

“So far, we’ve enabled vehicle owners to earn over $500,000 collectively by sharing their idle assets. Like any journey though, it hasn’t been without its bumps in the road,” Ellison says. “It took us two years to get off the ground, figure out the legal and insurance, on-road support and build the site.

“I’d studied to be a civil engineer, but was always passionate about how we move. I thought there had to be a better way. The average car is used 4 to 5 per cent of the time, meaning for 23 hours a day it’s sitting losing value.”

Like others in this sector, Ellison is enthusiastic about sharing assets that aren’t being used (“share the love”) to serve a generation that doesn’t feel the need to be tied to vehicle ownership.

His enthusiasm was pre-dated by nearly a decade by former Auckland City councillor, Victoria Carter, who founded Cityhop in 2007. When the self-titled “youngest politician to deliberately retire” was casting around for a new business, she spotted the nascent car share business in Australia.

The model of rental cars are dotted about the city (in ‘pods’), accessed by borrowers using an app on their phone, hasn’t changed, but Carter laughs at the pre-smartphone technology her company built from scratch for those first years. Cityhop now offers 80 cars to some 2,500 drivers in Auckland and Wellington, including the first fully electric vehicles. Many companies request pods at their offices to replace or supplement the company car fleet, with vehicles available to other users in the area too.

Victoria Carter, founder of Cityhop in front of a car share vehicle

Victoria Carter, founder of Cityhop

“The flash word now is ‘collaborative consumption’, which is actually what our great-grandparents did: sharing,” says Carter. “The change in behaviour today is that a car is a means of transport, rather than a status symbol. Young people care more about their phone than their car.”

In Wellington, Erik Zydervelt and his fellow founders of Mevo, an electric car share scheme, had seen the positive impact of sharing when they’d lived in America and Europe. Their interests in urbanism and conservation overlapped with strategy backgrounds, and they saw similar tech-focussed early adopters around the city.

The company, sponsored by energy company Meridian and launched with help of the city council and the Energy Efficiency and Conservation Authority, is growing their fleet to 50 Audi A3 electric cars. Many of their customers – some 200, with another 800 expressing interest – are small or large organisations that share their passion for sustainability. Their goal is to roll out into New Zealand’s five biggest cities with 2,000 vehicles by 2023.

“For every share vehicle like ours, 7 to 11 vehicles are taken off the roads, which frees up the roads and parking around the city,” Zydervelt says. “Many people grab a car at the end of the work day, and bring it back the next morning, for less than the cost of parking for the day. And we offset 120 per cent of our emissions using permanent rainforest credits from the South Island.”

While New Zealanders bought the most new cars ever in 2017, automotive companies are taking an interest in sharing technology. Toyota’s local finance arm has invested hundreds of thousands of dollars in Mindkin, a local vehicle sharing technology company, citing “new mobility services” as a way to deal with problems of increasingly scarce and expensive roads and carparks.

“More than talking about autonomous vehicles, we should be talking about redefining the ways cities move,” says Mevo’s Zydervelt. “This is the important
field of business leadership, to contribute to reversing climate change.”

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