Car sharing and relocation strategies: the case of CAR2GO

Car sharing can be defined as a service in which a group of individuals pay for “access a fleet of cars” with other paying individuals. At the base of this definition there is the concept of access. An access-based service relies on a transaction that may be market mediated in which no transfer of ownership takes place. From an historical perspective, the idea of sharing a car was born during the Second World War in USA, as a tactic to ration gasoline. In 1948 this service was organized in Zurich by the company SEFAGE. Subsequently, during the energy crisis of the 1970s, the car sharing was organized by car clubs. Then, in 1971, in Montpellier was founded a car sharing system called Procotip, and in 1973 was formed Witkar in Amsterdam. The first true form of organized car sharing was born in Switzerland in 1987 by citizens motivated by environmental problems. They formed two cooperatives: ShareCom and ATG (Auto Teilet Genossenschaft). In 1997 these cooperatives merged and formed a new organization: “Mobility, Car Sharing Switzerland”. After Switzerland, car sharing organizations were also established in other countries, especially in Austria, Germany and Netherlands, and later in many other countries around the world. The current rapid growth of mobile technology and internet allows to simplify the sharing process and are emerging new forms of car sharing. Nowadays, the main benefits that push consumers to use car sharing are convenience and time savings. The literature describes several car sharing business models: - Business-to-Consumer (B2C) car sharing, in which the company distributes cars at key points in the city; - NonProfit/Cooperative car sharing, in which the organization is a non-profit cooperative; - P2P Car sharing, that doesn’t need any additional vendor or supplier and is more sustainable than the B2C model. On the other hand, based on vehicles relocation strategies, there are two types car sharing: round-trip, when the car has to be brought back to the pick-up point; oneway type, in which the car can be left at a different point than the original location (Di Doi, and Danielis, 2015). Moreover, one-way car sharing is divided into two sub-types: (i)car sharing station– based, in which the company establishes the places to return the car; and (ii) car sharing free-floating where the car can be parked in a given area. Given the above definitions of the different types of car sharing, and their specific characteristics, this chapter will analyse in depth the business case of car2go, one of the most famous and successful car sharing free-floating companies in the World.