Transport for London (TfL) is facing growing calls to establish a pan-London action plan to protect and promote car clubs following the UK closure of the world’s biggest car-sharing firm.
Zipcar, which is owned by US car rental group Avis Budget, said it would suspend operations at the end of the year subject to a consultation on possible redundancies.
The pay-as-you-go car-sharing company’s decision comes amid Congestion Charge reforms in London which will see a 20 per cent price increase to £18 and the end of the electric vehicle (EV) exemption from the levy.
While Zipcar did not lay out the specific reasons for ceasing their UK operations, the firm has previously warned of the impact that the Congestion Charge changes would have.
In September James Taylor, the General Manager at ZipCar UK, told MPs that the removal of the 100 per cent EV discount could make car clubs “commercially unviable” in the capital.
He claimed car clubs are a “congestion reducing measure” in London and “therefore should be treated differently to the private car.”
The Mayor of London has previously cited car clubs as a crucial factor in “helping to reduce car ownership” in the city and said TfL “wants to see car clubs thrive.”
Earlier this year, however, the London Assembly Transport Committee published a report suggesting TfL policies on car clubs have led to inconsistent provision across the capital and caused some operators to pull out entirely.
The document, entitled ‘TfL’s Stalling Car Clubs’, recommended that the Mayor and TfL recognise the important role of car clubs, work on a pan-London action plan for their provision and roll out an awareness campaign on the benefits.
Committee chair Elly Baker AM said: “There is currently a patchwork approach to car clubs in London and they are failing to reach their full potential. This makes London a very hard city for car club operators to work in and could be one of the reasons for the closure of Zipcar.
“We need to see action from Transport for London (TfL) to establish a pan-London policy on car clubs to enable a more even distribution of car clubs throughout London, make them easier for Londoners to use and raise awareness.
“Unfortunately, the mayor recently rejected our call for TfL to develop a pan-London action plan – but the fact remains that TfL is stalling progression of car clubs in London, hence, the industry is in decline.”
Sir Sadiq Khan’s political opponents in City Hall said Zipcar’s decision was a wake up call for the Mayor.
Hina Bokhari, the Liberal Democrat group leader on the London Assembly, told the Local Democracy Reporting Service (LDRS): “Zipcar’s exit is a huge blow for Londoners trying to make greener choices and it’s a warning sign we can’t ignore.
“At exactly the moment we need both the mayor and the national government to support and accelerate the adoption of sustainable transport options like car-sharing and electric vehicles, they’re doing the opposite and making it less and less attractive to make sustainable choices.”
Caroline Russell, Green Party London Assembly Member and Leader of the Green Group, added: “ZipCar has played an important role helping Londoners to use cars less and give up on car ownership.
“Whether you’re moving house or going somewhere with poor public transport, these services provide a practical occasional alternative.
“ZipCar is not the only company to have found it hard to make shared mobility work well in London. There is a postcode lottery on where schemes run, how you park and even what you might pay. The mayor needs to work with TfL and the boroughs to develop a pan-London approach for car clubs, with the powers and consistency needed to make the system fair and effective.
“If we are serious about reducing car ownership and cutting traffic we need a coherent public approach. Ultimately, this is a service that should be supported, and potentially even provided by TfL, rather than left to a patchwork of unregulated private operators.”
Other Assembly Members accused Sir Sadiq of not doing enough to promote car ownership. Reform’s Alex Wilson said both the government and mayor’s “anti-driver” policies have created a “hostile environment” for businesses and motorists.
“It’s clear that by the timing of this decision, Rachel Reeves’ disaster budget was the final nail in the coffin for ZipCar,” he told the LDRS.
“This Labour Government are affecting the everyday lives of Londoners by driving business out of the country and depriving consumers of choice.
“Our grim economic future, along with Sadiq Khan’s anti-driver policies and planned pedestrianisation of major roads, has contributed to a hostile environment for businesses and drivers alike.”
The UK’s car club industry have repeatedly warned of the impact of Congestion Charge changes on the sector in recent months on the survival of firms.
From January, either Zipcar drivers or the company would have needed to pay an additional £13.50 a day for driving within the Congestion Charge Zone (CCZ). The only exemption for car clubs is when vehicles are picked up and returned to the same bay within the CCZ.
Richard Dilks, chief executive of CoMoUK, a shared transport charity, said: “Car clubs are making a huge contribution to reducing car ownership and mileage, so if this proposal is confirmed it will be a major blow.
“Every car club vehicle replaces 31 private cars in London, freeing up space, cutting congestion and improving air quality for everyone. We need coherent car and lift sharing plans across London, as this news clearly demonstrates.
“It would also have a significant impact beyond London, harming attempts to provide more low cost access to EVs and support public and active transport.”
Zak Bond, Campaign Manager of Clean Cities UK, added: “We’re very disappointed to see Zipcar withdrawing from the UK, a decision that represents a real setback for the electrification of transport in our urban centres.
“Electric car clubs can offer a scalable, cost-effective and flexible way for Londoners and local businesses to access electric vehicles exactly when they need them. We know that car clubs help give people the confidence to live without owning a private car, reducing both costs and congestion.
“At a time when cities are working hard to cut emissions and expand sustainable travel options, the loss of a major electric car-sharing operator is deeply concerning.”
A spokesperson for the Mayor of London told the LDRS: “The Mayor’s Transport Strategy is clear on the important role car clubs can play to reduce the need for private car ownership.
“This is why the Mayor recently announced that electric car clubs with a dedicated parking bay in the Congestion Charge Zone will receive a 100 percent discount on the Congestion Charge from January.
“We will wait to hear the outcome of Zipcar’s consultation.”
Zipcar have been contacted for further comment.
