Hundreds of thousands of Car2Go members to lose service as company pulls out of North America
Company, which operates in Vancouver and Montreal, blames 'volatile' market
The car-share service Share Now, formerly known as Car2Go, said Wednesday it will shut down operations in North America early next year.
The German company, which recently merged with the car-share service DriveNow under the name Share Now, says its last day of service will be Feb. 29, 2020.
Share Now has over 800,000 customers in North America. In Canada, it operates in Vancouver and Montreal. In Vancouver, the company's top market in North America, it has some 236,000 customers.
The closure will also affect riders in Chicago, New York City, Seattle and Washington.
Share Now blamed the shutdown on the "volatile state of the global mobility landscape" — citing increased competition among car-share services, rising operating costs and the lack of infrastructure to support new technology such as electric vehicles.
The Stuttgart, Germany-based company said in a statement it will also stop operating in London, Brussels and Florence, Italy due to low usage. It will continue to operate in 18 other cities in Europe including Berlin, Amsterdam and Madrid.
"We deeply regret the inconvenience this decision causes," Share Now said.
Already exited Calgary, Toronto
The company recently suffered major setbacks in North America.
It pulled out of Toronto in May 2018, blaming new city rules that rendered its service "inoperable," and abruptly left Calgary in October, where it was the only car-share service in operation. It also exited Denver; Portland, Ore.; Austin, Texas; and Chicago.
Car2Go merged with the German car-share service Drive Now in February 2019 under the name Share Now, although the fleet's branding in Canada stayed largely the same.
Share Now said it's pivoting to electric vehicles as part of its future strategy.
Patrick Condon, a University of British Columbia professor who studies sustainable urban design, said the company's pricing scheme hindered its business model. Its Smart cars go for 32 to 42 cents per minute and $14 to $18 per hour. Evo, another Vancouver car-share service, has similar prices.
"It's cheaper than the other options if your trip is only 10 minutes," Condon said.
"But if you want to have the car for an hour or so, it's much more expensive to use Car2Go. That put it in a position of only being useful for very short trips."
That puts the service in competition with cheaper options such as transit, biking or walking, Condon said.
In comparison, members with Modo, another car-share service in Vancouver, pay $5 hour per hour, on top of a $6 monthly fee.
Tai Silvey, the vice president of Evo, a car sharing service created by the British Columbia Automobile Association (BCAA), said car sharing is a "complex and expensive business. It's not easy to run."
He said while Share Now's departure will ease Evo's competition in the city, having a selection of transportation options is key.
"Choice is always a good thing for consumers so it's a sad day for that," he said, adding that "Evo is committed to Vancouver and here for the long term."
Ride-hailing to come to B.C.
Vancouver Mayor Kennedy Stewart said the company's departure isn't surprising and highlights the need for better transit in the city.
He's pushing for federal and provincial funding for a SkyTrain line to the University of British Columbia, the electrification of the bus system and more rapid buses around the region.
"In the end, it's not private gas-powered automobiles that are the future," he told reporters after a council meeting. "It's electrification and transit that we need."
B.C. Transportation Minister Claire Trevena said the province is looking at offering as many transportation options as possible, including the arrival of ride-hailing.
The province this week approved the first ride-hailing company in B.C. It's reviewing 23 applications from other companies, including Uber and Lyft.