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Monday, December 15, 2008

1:51 PM

Carsharing for Retirement Communities

I regularly get inquiries from people in retirement communities who realize that many residents are spending a lot of money owning vehicles that mostly sit around and realize that carsharing could be the answer.

I've heard that a few urban retirement complexes have had carsharing vehicles at them, most retirement communities are not located in urban centers, so doing-it-themselves is the only option at the present.

The most important issue to figure out is vehicle insurance - after that everything is easy. As everyone interested in carsharing finds out very fast, the carsharing concept is not embraced (or even very well-understood) in the insurance world. The insurance options vary depending on the business model that's set up - so it's a sort of catch-22 situation - you can't get a quote until you decide what kind of company you're going to be and you're not sure what kind of company you should be until you get an insurance quote.

It's worth noting that most commercial carshares have a 70+ age cut off, after which technically the member needs to provide an annual letter from a physician indicating they are fit to drive. That requirement by itself will often get a senior's blood pressure up a couple of notches all by itself!

To anyone contemplating starting a carshare, I would pose a couple of questions:

How large is the group of residents that wants to participate? If it's 5 or 10 households it's possible that doing something informal will be easier than trying to set up a formal business. Set up an LLC company to own the vehicle(s); agree the financial issues and on how to reserve the vehicles and how you'll notify each other. I'm told that Progressive has written a business policy for non-related individuals. Don't give up, keep asking.

If you see the service expending to more than 3 vehicles, you're probably looking at a creating a separate entity - nonprofit (or possibly for profit business) - to manage things. The options would be to set up a nonprofit or to build consensus within your group to have the management of your retirement community run the service (after all they probably already provide some transportation-related functions like vans to events). They could add the vehicles to their corporate liability policy (if they wanted to).

Establishing a nonprofit to operate the business itself seems the most likely. It could contract with a local garage to maintain the vehicles and clean them twice a month. The board would establish policies on membership, payment, reservations, gas reimbursement, etc. Many nonprofit organizations get their insurance from Non Profit Insurance Alliance of California, which works through brokers in many states.

Establishing a nonprofit corporation is very easy in most states. Don't worry about getting federal tax-exempt status for your nonprofit at this point, it's not nearly as important as you might think. It's primary benefit is to enable people who make donations to your nonprofit to write them off on their taxes. Any nonprofit can offer that right now by setting up a deal with organizations such as this or this.

A final possibility is to contact Enterprise WeCar, U Carshare or even Zipcar to see what their terms might be.  Typically, they will be looking for a minimum guaranteed usage revenue - probably over $1,000 per month and a minimum number of vehicles.  It's not worth your time to start talking to these companies until you have a pretty good idea of the number households that might be willing to use the service and how much they might drive.


If the majority of trips are likely to be a full day or longer - this is the domain of car rental and things are pretty straightforward. So a final option would be to try to make a deal with a local car rental operator, which in smaller communities may also the local car dealer, to set up a satellite rental "office" at your complex.  In this scenario your carsharing members would fill out car rental paperwork in advance, similar to joining one of the national car rental company's "number 1 club" with prearranged car rental preferences (such as supplemental liability coverage) and authorization. If the vehicles would come from your members, perhaps the rental company would agree to a management fee per rental or per month rather than providing the vehicles themselves.  

Of course this post doesn't get into technology or any of the other management issues which will be somewhat specific to the decisions made above. The best single guide to starting a carshare continues to be the short and long publications by City Carshare in San Francisco. Other resources can be found in the library at Carsharing.net including my now somewhat out of date 2004 guide for startups.

So here are a couple of more questions for small scale operations to get you started:

1) Are the vast majority of the trips your members will take going to be more than 12-18 hours?

2) Will a large percentage of the households in your potential carsharing group not own any car/truck at all?

If you answer yes to both of these, then consider a car rental model - easier insurance being the big advantage.

This is a start. I hope many others will contribute their ideas, suggestions and experiences below, as well.

Friday, December 12, 2008

4:08 PM

Carsharing Technology Overview


One of the first questions most start up companies ask is about technology for carsharing. The two major tasks for technology are: reservation system and car computer - for access to the vehicle and trip tracking. 

My position has always been to consider the technology that's appropriate for the size of operation you have in mind and grow into it.  It's not a "given" in my mind that a smaller start up even needs the car computers, but you can't live without automated reservations.

T
he interlocking pieces of a carsharing system are: 
  • Vehicle reservation/booking
  • Car computer - provides access to the vehicle at reserved time
  • Billing - uses reservation info + car distance
  • Member account management
  • Administrative and reporting
Typically, the reservation, billing and member account management system are part of a package.

Smaller carshares (under 100 vehicles) can do just fine without a car computer - and larger ones, too, as Autoshare, CAN and CommunAuto in Canada have demonstrated - but all use web reservation system. Smaller
carshares all use a web/operator reservation system and simply provide a mechanical lockbox at each location (e.g. Supra). However, implementing car electronics after you've grown to several hundred vehicles can be a major one-time expense, even if the equipment is leased. Retraining members to use the new system is another part of the challenge.

Reservation and Administrative Systems 

Reservation system are all web based. But alternative phone access to extend and cancel reservations is essential especially once a trip is underway.  This may be accomplished by an operator, touch tone phone or IVR "interactive voice recognition" technologies. In most systems the trip info is downloaded via wireless connection to the car computer so that only the member with a reservation can unlock the vehicle at the designated time.  Reservation and management system suppliers include:

Metavera - Toronto company provides reservation and admin services to many of the independent carshares in North America. Their Autovera system includes billing, management and reporting modules. Invers and Convadis car computers can communicate with Autovera system. Metavera also provides optional call center support with trained operators and other "back office" services.


U Reserve It - basic scheduling and management; no interconnection to vehicle system


Eileo - Also offers a free reservation service to individuals and small startup groups; can interface with Eileo Zibox system

Cantamen - European reservation/management system; currently can talk to Convadis and Invers car computers; claims to be "open source".


Carshare Everywhere - low cost service of Cooperative Auto Network, Vancouver, Canada for startups; no vehicle computer connection yet.

Car Computers

Car Computers provide access to the vehicle to the member, record trip time and distance. They may include GPS option for vehicle location, remote door unlocking, immobilizer and cell phone link to the call center for driver emergencies. The wireless connection between the server and car computer may cost $20-$40 per month per vehicle and uses either GPRS or SMS communications protocol via a cell phone carrier. Most systems use a standard RFID car for member identification and vehicle access. 

One of the major benefits of the car computer can be minimizing confusion by not allowing a member to take the wrong car at the wrong time.  Various levels of protection against vehicle theft are possible with most systems. Advanced features are needed to enable members to make and extend a reservation via the car computer and to allow "instant reservation", open-ended (no return time) trips and no fixed location parking options.  The active car computer providers are:


Invers - German company; grand-daddy of carsharing electronics used by Cambio and many carshares in Germany, Singapore and the UK, used by Flexcar (until merger); also offers basic reservation and management modules.

Eileo - French company; used by many French carshares; also Mint (NYC), Connect by Hertz and UK companies; also offers fully featured reservation, billing and management modules

Convadis - Provides car computers for Mobility Switzerland, Barcelona and others; active presence in the US; can talk to Metavera and Cantamen reservation systems.

Opencar - evolution from City Carshare (SF) technology; used by most independent carshares in North America; commonly paired with Metavera for reservation, billing and management software.

An alternative to a car computer is the Key Manager system from Invers which may be a very cost effective solution for multi-vehicle pods. It is widely used by Cambio carsharing in Germany. The vehicle ignition keys for the location are kept in a central lock box which is unlocked by the member using their RFID card.  The member returns the key to the lockbox at the end of the trip. 

One carsharing system I am not directly familiar with (and would welcome any first hand reports about) is Pilotfish, a Swedish fleet management and carsharing system. Zipcar has a proprietary reservation and and car computer system, which has gone through numerous upgrades.

Making a decision about which system or package would be best for the service you're considering involves many factors. Over the next few months I expect to add to this post so if you're interested in the topic please check back or contact me.

Monday, December 8, 2008

1:02 PM

Connect By Hertz Launches BIG


The long awaited carsharing service from Hertz car rental company finally surfaced last week - on the web at least  - Connect By Hertz.

And Hertz entered the market in a big way - in New York City, Paris and London.  (You'll have to use the "change location" button at the bottom of the any page to see the other cities.)

The official launch date is December 15 but some vehicles are currently available.
The initial launch in NYC is right in the heart of prime territory for Zipcar - where a substantial percentage of their Manhattan fleet is centered.

The Connect website features the now standard "darling" of hip carsharing marketing - the BMW Mini (in a very sporty image), listed as their "Jet Set" class vehicle which starts at $10/hour.  The other vehicle classes are: Social - Toyota Camry and Personal - Toyota Prius.  Other vehicles in the initial launch include Ford Escape and Mazda 3. This is a much more narrowly focused vehicle selection than Zipcar or Mint offers, presumably based on some familiarity with the market since they've been renting cars for many years in New York City. The web site suggests that all vehicles are equipped with Hertz "Never Lost" turn by turn navigation systems - a very smart move by Hertz!

In London the 3 vehicles are: Compact - Ford Fiesta; Family - Ford Focus; Fun - Mini.  In Paris, the line up is: Compact - Opel Corsa; Family - Opel Meriva and Sport - Mini.

Like every other carsharing company they are seeking the consumers' sweet spot to commit to a certain amount of spending per month (I originally said "driving per month" here - Dave).  Connect By Hertz offers three membership categories, each with different hourly rates:
  • Connect - standard no monthly fee - usage at $10-$12-$14 per hour + annual membership of $50.
  • Connect 50 - $50 per month min. - usage at $9-$10.80-$12.60 per hour
  • Connect 125 - $125 per month - $8.50-$10.20-$11.90 per hour
The daily rental range presents a real challenge for a car rental company since they would prefer to minimize stealing customers from their traditional car rental business - at least unless they could hope to earn more money from them through carsharing.   Presently, the only direct competition would be the Prius, available from Connect for $70/day down to $59.50/day, depending on the rate plan, including 180 miles; while in the car rental division's "Green" collection the Prius rents for $97.49 per day, less taxes and without gas or GPS. Other comparable rentals would be a Ford Focus for $81/day and Mazda 6 for $87/day.  

Actually, the fine print on the Connect web site says if you rent a car for over 8 hours in a day, you'll only be charged for 8.   There's no mention of roll-over "hours" that Zipcar offers for its various Extra Value Plans (a very nice feature).  Reservation changes and cancellations can be made 4 hours or more in advance of the trip start at no fee; otherwise members pay the reserved hours, up to a day's use (8 hours).

Congratulations to Hertz for taking the plunge .  And congratulations, too, to Eileo for an international deal.   Meanwhile, we're wondering what's happening over at Mint?

PS: Here's an interesting interview with Hertz CEO Mark Frissora about Connect by Hertz (while it lasts on the internet).






Friday, December 5, 2008

9:35 AM

Carsharing research featured at January TRB sessions


January is time for the annual Transportation Research Board meeting in Washington, DC - the leading meeting of academic and industry research an information. Several sessions will cover carsharing topics at this year's TRB starting on Monday afternoon, January 12. All will be held at the Hilton Washington, 1919 Connecticut Avenue, NW, Washington, DC 20009 (Dupont Circle Metro stop).

General information about TRB and the annual meeting can be found the TRB website. Your author will be at most of these sessions, as well as the special session on Sunday afternoon, January 11, about public bicycle systems, a topic that also interests me.

The annual meeting of the "carsharing" subcommittee will meet on Monday, January 12 from 1:30 to 3:15 pm at the Hilton, Dupont. (The subcommittee is changing its name to "Shared-Use Vehicle Public Transport Systems subcommittee of the Emerging and Innovative Public Transport and Technologies Committee (AP020).

Sessions about carsharing at this year's TRB include the following. Click on the hyperlink for each session title to get easy access to full descriptions of each paper. PDFs of the full papers are included on the CD proceedings included with conference registration ($500).

Session 409 - Carsharing as a Climate Change Mitigation Strategy
Monday, January 12, 2009, 7:30 PM - 9:30 PM, Hilton
Matthew J. Barth, University of California, Riverside, presiding

This session explores the potential of carsharing as a greenhouse gas mitigation strategy. It includes presentations on the impacts of carsharing including auto ownership, fuel use, vehicle miles traveled, and modal shift. It also explores the role of public policy in supporting this transportation alternative.

Assessing Greenhouse Gas Emission Impacts from Carsharing in North America
(P09-1731)
Elliot Martin, University of California, Berkeley

Carsharing: An Urban Climate Strategy in the U.S. (P09-0666)
Sharon Feigon, I-GO Car Sharing

Role of Carsharing Policy in Greenhouse Gas Emissions (P09-0661)
Kevin McLaughlin, AutoShare

Carsharing in the Twin Cities: Measuring Impacts on Travel Behavior and Automobile Ownership (09-0446)
Frank Douma, University of Minnesota
Ryan Gaug, Minnesota Department of Transportation

The following posters are also scheduled for TRB. Authors will likely be present during this scheduled time:

Poster Session 549 Carsharing and Shared-Vehicle Research
Tuesday, January 13, 2009, 2:30 PM - 5:00 PM, Hilton
Susan A. Shaheen, University of California, Berkeley, presiding

Modeling Activity Persistency of Carsharing Members Using Dynamic Ordered Probability Model (09-0693)
Catherine Morency, Ecole Polytechnique de Montreal, Canada
Khandker M. Nurul Habib, University of Alberta, Canada
Vincent Grasset, Ecole Polytechnique de Montreal, Canada
Hamid Zaman, University of Alberta, Canada

Evaluating the Effect of Carsharing: Exploring the Gap Between What We Know and What We Need to Know and Its Effect on Optimism Bias (09-0742)
Gil Tal, University of California, Berkeley

Wireless Networks for Car- and Ridesharing Systems: Assessment of 802.11 Wi-Fi (09-0750)
Rex Chen, University of California, Irvine
Amelia Regan, University of California, Irvine

Concepts for Large-Scale Carsharing System: Modeling and Evaluation with Agent-Based Approach (09-1888)
Francesco Ciari, Swiss Federal Institute of Technology, Zurich
Michael Balmer, Swiss Federal Institute of Technology Zurich
Kay W. Axhausen, Swiss Federal Institute of Technology Zurich

Carsharing in France: Past, Present, and Future (09-2007)
Robert Clavel, CERTU, France
Muriel Moriotto, CERTU, France
Marcus Paul Enoch, Loughborough University, United Kingdom

Carsharing and the Built Environment: GIS-Based Study of One U.S. Operator (09-2963)
Tai Stillwater, University of California, Davis
Patricia L. Mokhtarian, University of California, Davis
Susan A. Shaheen, University of California, Berkeley

User Characteristics and Responses to Shared-Use Station Car Program: Analysis of ZEVïNET in Orange County, California (09-3260)
Matt Heling, University of California, Irvine
Jean-Daniel Maurice Saphores, University of California, Irvine
G. Scott Samuelsen, University of California, Irvine

Carsharing in a University Community: Assessing Potential Demand and Distinct Market Characteristics (09-3396)
Jie Zheng, University of Wisconsin, Madison
Michelle Scott, University of Wisconsin-Madison
Jessica Y. Guo, University of Wisconsin, Madison
Miguel Angel Rodriguez, University of Wisconsin, Madison
William Sierzchula, University of Wisconsin-Madison
David Platz, University of Wisconsin-Madison
Teresa Adams, University of Wisconsin, Madison

North American Carsharing: Ten-Year Retrospective (09-3688)
Susan A. Shaheen, University of California, Berkeley
Adam Cohen, University of California, Berkeley
Melissa Chung, University of California, Berkeley

Finally, one of the papers to be presented at a climate change session will include a discussion of carsharing

Session 795 Behavioral Considerations in Response to Energy Prices and Global Climate Change
Thursday, January 15, 2009, 10:15 AM - 12:00 PM, Hilton

Psychological Analysis of Acceptance of Pro-environmental Use of the Automobile: Cases for Carsharing and Eco-car (09-3689)
Hiroyuki Ohta, Tokyo Institute of Technology, Japan
Satoshi Fujii, Tokyo Institute of Technology, Japan
Yoshihiro Nishimura, Toyota Central R&D Labs., Inc.
Misuzu Kozuka, Toyota Central R&D Labs., Inc.

Again, General information about TRB and the annual meeting can be found at the TRB website. I look forward to meeting you at TRB.