June 10th, 2009 | 
Author: Zipcar Inc., is presently the world’s largest car-sharing company, but it’s now being challenged by big-time companies such as Hertz Global Holdings Inc.
Hertz Chief Executive Officer Mark Frissora said, “It’s a cool technology. My two sons use Zipcar and they said, ‘Dad, you have to get into this’” and Hertz is set to announce its own sharing service, starting with 1,000 vehicles in New York City, by the end of the year.
Zipcar Inc. was not taken seriously when it first started out and was considered by most to be simply a joke.
It only had one car, and that was a lime-green VW Bug.
Now it boasts over 6,500 cars, will show its first profit in the third quarter, and that during a major recession!
What Is Car Sharing?
Users of the service swipe an access card over a reader in the windshield to unlock a Zipcar through a wireless data link, and the keys are waiting inside, attached by a cord to the dashboard.
The cars can be rented by the hour or day, and the annual fee includes, gasoline and insurance.
The service is presently available in 28 U.S. states; several Canadian provinces, as well as in London, England.
The reservation system tracks where a Zipcar is left by the last user, and is even able to lock out a driver who’s kept the auto past the agreed time.
Reservations, pickups and returns can be handled self-serve through the Internet, or by telephone.
How Much Does It Cost?
Zipcar customers currently pay an annual membership fee of just $50. 00 plus $8.50/hr. which includes 125 miles/day and gasoline.
The number of venture-backed IPOs this year is down around 90% percent from the same period in 2007, but Scott Griffith who is CEO of Zipcar says, “We’re succeeding and we’re growing in a year where flat is the new up. Sales will reach $120 million this year and grow to $1 billion within a decade”.
When Griffith became CEO in 2003 the company had 5,000 members.
It now has over 3000 members and the company licenses its proprietary software to city governments in order to reduce costs.
How Big Is The Potential Market?
According to a report that was commissioned from the Economist Intelligence Unit – 37 million customers and yield $10 billion a year in revenue – and that’s big business!
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