Life after Uber: Car market in the next 10 years

Today, the world economy is going through a certain stage of transformation: futurists predict an early transition to Industry 4.0, economists analyze how the process of "convincing" affects the world markets, while others are paying attention to an equally important process - the transition to the sharing economy.

The phenomenon of Uber played a significant role in the formation of new economic processes. We all admired the ease of use of the application, the ability to save, its unique model and user-friendly interface. Other businesses began to adjust the model for themselves, and the economy began to experience global withdrawal. Especially the car market has changed. The car, in principle, is the first facility on which the transformation of the economy is "felt": after Uber, the next milestone in development has been the carshering. And what will happen next?

Uber, in fact, is a real economic phenomenon that, along with Airbnb, transformed the model of "acquisitions" into a model of sharing. Taxis in the US are quite an expensive means of transportation, because the license is worth a lot of money. With the advent of Uber, the taxi became much cheaper, and the popularity of the service began to grow at an incredible rate.

For several years, Uber has spread its influence not only to all continents, but also to many spheres of the economy - entrepreneurs began to lay down the concept and format of the belief in the model of their services and to transform existing businesses.

In 2015, Ford launched a pilot car exchange program in London called GoDrive. In 2016, General Motors invested in the Chinese company Yi Wei Xing, which offers a short-term lease service and another $ 500 million in Lyft's carsharing.

 Large corporations understand that they have to adapt to the new model, otherwise they will remain in the outsiders for a long time. It's amazing that the startup could so strongly influence the world's giants with a great history. But what is important is that Uber not only launched the phenomenon of persuasion, but also initiated the development of the entire sharing economy.

Today, the shearing economy is a kind of post-conviction. Entrepreneurs played enough in the model Uber and went further - invented the model of sharing. Today, you can "share" anything: you can cheaper and more profitable to live, travel, rest and use the same car.

Carsharing is the second economic phenomenon of the XXI century

The next step after Uber was the format of the card. The first carsharing servicesbegan to appear in the early 2000's, but their true flowering came only after 15 years. Why?

The fact is that for a long time the economy was not ready for the format of the sharing, people did not understand how it works - they were taught all the time that you need to save money, buy cars, equipment and other benefits of life. And for what then do we need a carshare, if one of life's goals is a personal car?

But at the same time, a car is one of the most expensive purchases in a person's life. At the same time, most of the time it is idle on the street or in the garage and is used less than 5% of the time of general use. Plus it needs to be serviced, buy a parking space and insurance, do TO, pay tax and so on. And with the advent of Uber, it was possible to order a taxi in one click. Then the client began to think differently: why fidget with buying your own car, if you can open the application and two minutes later a taxi will arrive?

There are also situations when it is inconvenient to go by taxi because of a difficult or too short route or when the car is needed for the whole day. And here, too, users are thinking: why do you need your own car, if it is much easier to use the car-sharing?

European and US carsharing

The first carsharing appeared in Europe and the USA, and one of such services was the American service Zipcar, which appeared in 2000. To use it, you need not only pay for rent, but also make an annual membership fee. An interesting feature - you can rent a car at least one minute before the start of the trip, even for a whole year.

Another one of the most famous and large players of the market is the German Car2go. It appeared in 2008 and today it is the largest in the world of the grocery service - it registered about 2.5 million users and it works not only in the European market, but also in the USA. An interesting point - Car2go to use offers exclusively Smart Fortwo and Mercedes-Benz.

In general, in Europe the model is quite common, when the service offers one particular automotive brand. For example, the car park of the French Autolib consists of one electric Bolloré Bluecar, and the German DriveNow offers users only BMW and Mini.

The market of carsharing continues to grow: according to Global Market Insights, by 2024 its volume will exceed $ 16.5 billion. Companies renting cars and taxis have nothing left to do but to modernize their model. But they are not in a hurry, especially in regions where their services are still in high demand.

The situation in Asia

The model of carsharing conquered Asia. For example, the first carsharing in ChinaCar2Share appeared back in 2009. Now the service offers to lease about two million cars. For the time being, this is the most popular carsharing service in China, but the market is constantly appearing startups, offering to rent electric cars. And given the authorities' intention to restrict the sale of cars with a gasoline engine, perhaps Car2Share will have to make room.

 In Asia, quite popular models of the carsharing services, when in addition to the rent there is a monthly payment. Japanese Orix offers customers several tariff plans, depending on the frequency of use.

But, for example, the Indian Zoomcar is not nearly as convenient as most other services - the car will have to be returned to the same place from where it was taken.

What will happen after the carsharing?

There are different models of user behavior, and if the service wants to be successful, it must meet these requirements. Therefore, it is reasonable that services should be developed for those who need rent for a few days or need to rent a capacious SUV, or maybe a representative sedan.

Today, users no longer want the resolution of issues to take a long time - no one will want to personally come to the rental services, fill out documents, leave bail and so on. Therefore, once in Europe, there was another format of car service - p2p-rent a car. Such services assume that any car owner can lease his car for any period to another user. To rent a car, as a rule, it is enough to choose it on the site by the given parameters, specify the rental period and pick up the car from the owner - or agree on the delivery of the car to the lessee.

So far, the model is not as widespread as the classic format of the car. The largest and most successful service in the p2p-rental segment is the American Turo.

In Russia, the model is represented, for example, by the services of Use My Car, Rent-a-ride and Darenta. A big difference between the p2p and the p2p model is that car owners receive an additional source of income, as well as the ability to "repulse" the costs of gasoline and maintenance.

What will the market be like in the next 10 years?

Interest in buying a new car in the primary market is declining year by year.

 According to the Autostat, in January 2017, the volume of the market for cars with mileage in Russia grew by 1.9% compared to the same period in 2016.

 According to a study by PwC, the cost of owning a car in Russia in 2017 was from 195 thousand rubles to 1 million 170 thousand (depending on the brand).

 And representatives of the generation of Z and Y will rather prefer to invest this money in training, self-development and travel, so sales of new cars will continue to decline, and interest in sharing models to grow. Uber, carsharing  and p2p-sharing will exist on an equal basis, as each model has its pros and situations in which they are needed.

Benefits of Uber

·             inexpensive trip;

·             the trip is not behind the wheel;

·             the opportunity to earn on the car (the driver).

Advantages of the carsharing

·             quick access to the car;

·             any route with numerous stops.

Advantages of P2P-sharing

·             the choice of any car;

·             different travel objectives / short and long trips;

·             the possibility of earning on the car for the owner (while not working).

All these advantages are suitable for different situations, and the services working on these models will allow you to completely abandon your own car. Therefore, in the next 5-7 years, it is absolutely possible to expect a decrease in the number of own cars and the growth of popularity of automobile services of the sharing economy.