🔗 Share this article

The volunteer food project in Rotherhithe has provided a large number of prepared dishes each week for two years to pensioners and needy locals in south London. Yet, the group's plans face major disruption by the news that they will lose cars and vans on New Year’s Day.

The group depended on Zipcar, the car-sharing company that customers to access its fleet of vehicles via smartphone. The company caused shock through the capital when it declared it would shut down its UK business from 1 January.

This means many helpers will be unable to pick up supplies from the Felix Project, that collects surplus food from grocery stores, cafes and restaurants. Other options are further away, costlier, or lack the same flexible hours.

“The impact will be massively,” stated Vimal Pandya, the project's founder. “Personally me and my team are worried about the logistical challenge we will face. A lot of people like ours will face difficulties.”

“Faced with this reality, they are all worried and thinking: ‘How will we continue?’”

A Major Blow for Urban Car-Sharing

These volunteers are part of more than half a million people in London who were car club members, who could be left without convenient access to vehicles, avoiding the burden and cost of ownership. Most of those members were likely with Zipcar, which held a dominant position in the city.

This shutdown, pending consultation with employees, is a serious setback to hopes that vehicle clubs in cities could reduce the need for owning a car. However, some analysts also suggested that Zipcar’s departure need not mean the demise for the concept in Britain.

The Promise of Car Sharing

Shared vehicle use is valued by city planners and green advocates as a way of reducing the problems linked to vehicle ownership. Typically, vehicles sit idle on the side of the road for 95% of the time, using up space. They also involve large CO2 output to produce, and people who do not own cars tend to walk, cycle and take transit more. That helps urban areas – easing congestion and pollution – and improves public health through more exercise.

What Went Wrong?

Zipcar was founded in 2000 before its acquisition by the US car rental group Avis Budget in 2013. Zipcar’s UK income barely registered compared with its parent company's overall annual revenue, and a deficit that reached £11.7m in 2024 gave little incentive to continue.

Avis Budget has said the closure is part of a “broader transformation across our global operations, where we are taking deliberate steps to streamline operations, improve returns”.

Its latest financial reports noted revenues had declined as drivers took fewer and shorter trips. “These changes reflect the continuing effect of the economic squeeze, which continues to suppress demand for non-essential services,” it said.

London's Unique Hurdles

However, several experts noted that London has particular issues that made it difficult for the sector to succeed.

• Patchwork Policies: With numerous local councils, car-club operators face a patchwork of varying processes and costs that made it harder.
• New Costs: The closure coincides with electric cars becoming liable for London’s congestion charge, adding unavoidable costs.
• Parking Permit Disparity: Locals in some boroughs pay just £63 for a annual electric car parking permit. A floating car club would pay over £1,100 annually, creating a major disincentive.

“We should literally be charged one-twentieth of a resident’s permit,” argued Robert Schopen of Co Wheels. “We’re taking cars off the street. We introduce cleaner models in their place.”

Lessons from Abroad

Nations in Europe offer models for London to follow. Germany enacted national shared mobility laws in 2017, providing a unified system for parking, subsidies and exemptions. Now, the country has several shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK trails at 0.7.

“The evidence shows is that shared mobility around the world, particularly on the continent, is growing,” said Bharath Devanathan of Invers.

Devanathan said authorities should start to view vehicle clubs as a form of mass transit, and link it with train and bus stations. He added that a potential operator was looking at entering the London market: “There will be fill this gap.”

What Comes Next?

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

1. Company-Owned Fleets: 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. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

Turo, a US-headquartered peer-to-peer platform, is already weighing up the UK gap. Rory Brimmer, its UK head, said there was a “big opportunity” to win more users. “A space exists 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 establish themselves. For now, more people may choose to buy cars, and many across London will be left without access.

For the volunteers in Rotherhithe, the next month will be a rush to find a way. The logistical challenge caused by Zipcar’s exit highlights the wider implications of its departure on vital services and the future of car-sharing in the UK.