Car Sharing: What It Is and What Are The Benefits?

What Is Car Sharing?

In recent years, a new type of car ownership has emerged and spread across the globe – car sharing. Car sharing allows people to access a vehicle for a short period of time, typically by the hour or day, without having to commit to owning or leasing a car themselves. Carsharing is very similar to renting a car; only you don't have to talk with a rental agent when making the transaction. This means you can borrow a vehicle in the middle of the night if you need one, and you can borrow a car for just 10 minutes if that's all the time you need. You'll spend less money using the car, which can make it more affordable than getting a rental for a full day just to complete a quick errand. Usually, if you want to share cars, you will have to sign up for a membership with a service such as Zip Cars. Once you do that, you'll get a special card and a tool that lets you see where all the different vehicles are parked in your area.

Types Of Car Sharing

There are many different types of car sharing, but these three most common models are round-trip, one-way and peer-to-peer. Round-trip car sharing requires users to return the vehicle to the same location they picked it up from, one-way car sharing allows users to drop off the vehicle at a different location from where they picked it up. Peer-to-peer car sharing is a model where individual car owners rent out their vehicles to other people through an online platform. Instead of a company owning the cars (like with traditional car sharing services), regular people list their personal vehicles on a platform, and other users can book and rent these cars.

The carsharing service covers things like gas for you, so you don't have to worry about it, and you pay for the total distance you traveled and how long you had the car.

The arrival of carsharing programs has coincided with a shift in attitude towards car ownership, particularly among young adults. A study by APTA found that 42% to 55% of millennials in the US would rather use a shared service than own a car. This figure is likely to increase as millennials enter their prime buying years and as car-sharing becomes more widespread.

While some believe that car sharing will lead to fewer people owning cars overall, others believe that it will simply lead to people owning fewer cars per household. Either way, there is no doubt that car sharing is having an impact on how people use and access vehicles.

What Are The Best Car Sharing Companies?

When considering the best car sharing companies, it's important to evaluate factors such as availability, pricing, vehicle options, and user experience. Here are some of the top car sharing companies that excel in these areas:

• Zipcar: Known for its wide network and variety of vehicles, Zipcar is a popular choice for those seeking flexible hourly rentals with easy access in major cities.
• Turo: Turo offers a unique peer-to-peer car sharing experience, allowing users to rent vehicles directly from car owners. It's a great option for those looking for specific car models or longer-term rentals.
• Getaround: This platform emphasizes convenience with its instant booking and contactless entry features. Getaround is ideal for urban drivers needing a car for short trips.
• Lyft Rentals: A service from the well-known ride-sharing company, Lyft Rentals provides a seamless experience for users already familiar with the Lyft app, offering competitive daily rates and a straightforward rental process.
• Car2Go: Now part of Share Now, Car2Go is known for its one-way car sharing, allowing users to pick up a car in one location and drop it off in another within the service area, making it perfect for spontaneous city trips.

Each of these companies offers unique benefits, so choosing the best one depends on your specific needs and preferences.

Benefits of Car Sharing

There are several economic impacts and benefits that car sharing can have on car ownership.

• One is that it can help to reduce the number of cars on the road, which can help to reduce traffic congestion and pollution.
• It can also help to save people money on their car insurance premiums, as well as on fuel and maintenance costs.
• Car sharing services typically choose cars like Priuses and other new vehicles that use less fuel, benefit from fewer emissions, and are less harmful to the planet overall.
• Car sharing is also convenient, as it allows users to pick up and drop off vehicles at locations that are close to their destination
• In addition, car sharing can provide an alternative form of transportation for people who do not have access to a car, or who cannot afford to own one.

People that own a vehicle drive far more frequently than those that use a car sharing service, which is bad for the environment overall.

What Does Car Sharing Insurance Cover?

Car sharing insurance is specifically designed to cover the unique needs of car sharing, whether you're renting a car through a service or offering your vehicle for others to use. Here's what car share insurance typically covers:

• Liability Coverage: Liability insurance protects you if you're at fault in an accident while using a shared vehicle, covering damages to other people’s property and any injuries they may sustain.

• Physical Damage Coverage: This includes collision and comprehensive coverage, which pays for repairs to the shared vehicle if it's damaged in an accident, vandalized, or affected by natural events like storms or fire.

• Uninsured/Underinsured Motorist Coverage: If you're involved in an accident with a driver who doesn't have sufficient insurance, this coverage can help pay for your injuries and damages.

• Personal Injury Protection (PIP): This covers medical expenses and sometimes lost wages for you and your passengers, regardless of who is at fault in the accident.

• Rental Reimbursement: If the shared vehicle you're using is in an accident and requires repairs, this coverage can help cover the cost of a temporary replacement vehicle.

Car share insurance is essential for both renters and vehicle owners, as it ensures that all parties are protected in case of an accident or other unforeseen incidents during the rental period.

Effects of Car Sharing on Car Ownership

Carsharing services have been widely touted as a way to reduce traffic congestion and pollution, as well as the need for parking. The logic is that if people can use a car when they need one, without having to own one, they will be less likely to drive as often.

Several studies by the University of California, Berkeley suggest that car sharing may finally be having an effect on car ownership rates. The study found that in five major U.S. cities—Boston, Chicago, New York, San Francisco, and Seattle—carsharing services have led to a reduction in household vehicle ownership of between 0.5 and 1 vehicle per household.

The study also found that the longer people used a carsharing service, the more likely they were to give up their personal vehicle. In fact, after two years of using a car-sharing service, households were 30% less likely to own a vehicle than when they started.

While the effects of car sharing on car ownership rates are still relatively small, they are significant and are likely to grow in the coming years as more people adopt these services.

How Car Sharing Changes the Way People Own Cars

Car sharing is a new and innovative way to own a car. Instead of buying or leasing a car, you can now share a car with other people. This means that you only pay for the time you use the car and not for the entire ownership of the vehicle. Car-sharing can save you money on car payments, insurance, and maintenance. It can also help you reduce your carbon footprint by sharing a car instead of each person owning their own vehicle.

Car Sharing vs Car Subscription

Car sharing offers a flexible, cost-effective way to access a vehicle without the long-term commitment of ownership. Most car sharing programs are membership-based, where users pay a monthly or annual fee to access a fleet of cars, with pay-as-you-go options charging per hour or per mile. Membership fees typically range from $30 to $100 per month, with additional application and renewal fees.

In contrast, car subscription services provide a more comprehensive, longer-term option. Subscribers pay a monthly fee, generally ranging from $500 to $1,500, covering insurance, maintenance, and access to various vehicles. Car subscriptions are ideal for those needing consistent vehicle access without the responsibilities of ownership, offering more flexibility than car sharing but at a higher cost.

Challenges Faced by Car Sharing Programs

Despite the many benefits of car-sharing programs, there are still some challenges that these programs face. One of the biggest challenges is getting people to sign up for the program. Although car sharing offers a convenient and affordable alternative to owning a car, many people are still not familiar with the concept. There is also a lack of awareness of the different car sharing programs available.

Another challenge faced by car sharing programs is finding enough parking spots for cars. In densely populated areas, it can be difficult to find adequate parking for all of the cars in the program. This can lead to frustration among members who are unable to find a spot when they need one.

Lastly, car sharing programs also face competition from traditional rental companies. Many people are already familiar with renting cars and may not see the need to switch to a car sharing. Traditional rental companies also have a wider selection of vehicles available, which can be appealing to customers looking for a specific type of car.

Carsharing has revolutionized the way many people think about car ownership, offering an affordable and convenient option for those who need to get from place to place. By reducing the number of cars on the road and making car rentals more accessible than ever before, it has had a substantial impact on both urban areas as well as rural communities while also providing its users with a cost-effective transportation solution.

Is Car Sharing or Owning a Vehicle Better for You?

With its growing popularity, there's no doubt that this service will continue to benefit consumers in years to come. However, we understand that this growing trend may not be for everyone, especially when you look at some of the long-term or hidden costs that may be involved. If you would rather own your vehicle instead of using a car sharing service, we encourage you to check out the GoodCar vehicle marketplace, where you can find the perfect car for your needs and budget!