The way we transport ourselves in our day-to-day lives has changed dramatically in the last one hundred years. We have gone from horse and buggy to personal cars in the blink of an eye, and since then the way we use our cars has been transformed. As a population we no longer just own a car anymore; we either own one, do not use one, take a taxi, rent, or even share cars. Car sharing is the practice of sharing a car with other individuals through a company that owns and operates the business. It has gained popularity all over the world, especially here in America. After the recession in 2008, trying to find ways to finance a car has become harder for the average citizen. It is almost impossible to fully pay off a car, and insurance and high gas prices make people’s budgets even tighter (Lutz, 2010). As more consumers have come to desire not owning personal vehicles, car sharing has, and will, become more popular to the new type of consumer, causing car sharing programs in America to be utilized more often.
To own a vehicle in America, on average it costs (excluding gas) $9,122 per year. Members of CarShare Vermont who drive 100 miles over 10 hours per month spend only $1,200 per year (CarShare VT, 2016). When it comes to car sharing there are a lot of benefits, both personal and communal. Personal benefits include financial savings; no car purchase, no insurance, and a much smaller monthly payment. Also depending on the organization that you are a part of, you have access to multiple types of vehicles to suit whatever your needs are (Ortega, 2010). The benefits of joining car share and getting rid of a personal car has really attracted one particular group. The population that seems to be joining car share programs more often than others is the younger adult population. About 68% of car share members in the U.S are between 20 and 40 years old, and 85% of them have a bachelors degree or higher. Young adults emerging out of college and moving into cities are starting to look at vehicle ownership as a hassle and not the way they want to get around. They do not see cars as a status symbol anymore, nor as a symbol of freedom, more like a symbol of unnecessary attachment. This generation also tends to be more environmentally aware, and realize that being a car share member will encourage them to drive less, as well as take more cars off the road overall (Tsuruta, 2012). The idea of stronger communities, less stress on the environment, and lots of savings will keep the younger generation enrolling into this program as long as it is more viable than owning a vehicle, but just as convenient.
Just published on October 30th, 2016 was an article by Madeline Farber about how the big car companies all over the world are starting to scramble to join in on car share companies. Toyota announced that it invested in the U.S Car Share start up Getaround in order to have a platform in the new business model. The article points out that already car companies have been investing in car sharing models and also taxi-like business models including Uber (Toyota) and Lyft (General Motors). Business Insider picked up on the concerns of Elon Musk, CEO of Tesla, and the companies concern about ride sharing models like Uber, their potential solution, The Tesla Network. In the article the Tesla Network is described as a car sharing program owned by the people, where owners of Tesla’s could rent out their vehicle for a fee, and their normal depreciating asset can now become another source of income. Tesla wants people to remain car owners but understand that cars are a large investment that do not turn over any money for their consumers. Therefore they want to take the depreciating asset and turn it into a source of income, making the investment worthwhile. The sharing economy has expanded in what kinds of services it provides to people all over the world. The Economist describes the peer-to-peer rental market (car owners share their personal cars with others instead of using cars owned by an organization) as a $26 billion industry alone. Both types of car share models are rapidly increasing in membership, and it looks like there is no stopping. It is just more economically feasible, and economically smart. Not only do people save money, but also they can make money off of their assets that are normally depreciating (The Economist, 2013). Car sharing might just be the solution to our car problems, are you willing to jump on the bandwagon?
Bio: I am an Environmental Studies student from Vermont about to graduate from college and enter the real world, with me I will pack knowledge, community participation, too many hours on Netflix, and enthusiasm to learn everything I can.
Student Author: Isabelle Federico (The University of Vermont)
Faculty Advisor: Rob Williams (The University of Vermont)