Motor Insurance

The rental revolution: Is this the end of car ownership?

In larger cities, people are increasingly turning towards car sharing to save money on ownership costs. Find out how car sharing works and if it might be right for you.

Whilst car sharing in some form has been around almost as long as cars themselves, the sector has recently evolved significantly. Traditionally ‘car sharing’ has often referred to carpooling, where multiple people travel in one car in order to save money. However as the Internet, mobile apps and new types of insurance have evolved over the last decade, ‘car sharing’ now increasingly refers to renting a car parked on a street that is owned by a company or, increasingly, another person.

This new type of peer-to-peer car sharing is not only challenging our traditional ideas of sharing but also our perceptions of car rental, as drivers are now able to access cars whenever and wherever they need one.

Economical

In London, for example, owning a car can be particularly expensive. Not only do Londoners face all the usual costs of MOTs, tax, and insurance premiums, but they also incur significant charges for parking, driving in the congestion zone and now also the newly introduced Ultra Low Emission Zone (ULEZ). With it seeming like these additional costs are going to continue to increase, it’s easy to see why so many people are moving away from traditional vehicle ownership and turning towards car-sharing platforms.

The ease and benefits of peer-to-peer car sharing for both the lender and the renter have contributed to its boost in popularity, and with the number of available vehicles constantly growing, there are even more options to choose from.

Convenience

Convenience is well and truly at the core of peer-to-peer sharing. To use the service, all you have to do is sign up, be verified, and select the most suitable car from the available options. Driving away is equally as easy with the introduction of keyless technology allowing users to unlock the vehicle using an app on their smartphone.

Ultimately, peer-to-peer car sharing removes the middleman; meaning it is not only cheaper but is also more convenient than traditional rental companies. In London, peer-to-peer car-sharing companies such as hiyacar offer a large database of conveniently-situated well-maintained cars that can be accessed without the operational constrictions of traditional rental companies.

The Future of Car Ownership?

With all of these benefits, it’s easy to see why this new form of car usage is threatening notions of traditional car ownership. This is particularly the case for individuals who only require a car every so often, paying for a vehicle only when they need it rather than outright owning one. There are also certain environmental factors that have contributed to the platform’s popularity—with an increasing number of people now choosing car sharing over car ownership, the positive impact on emission levels and cluttered streets is starting to make a real difference to cities.

Car sharing is growing, and it is only a matter of time before its growth within large cities is replicated in smaller areas as well. Car sharing is becoming an incredibly appealing option for both drivers and owners, and it’s clear that the future will see even more people making the switch from traditional car ownership to the convenience of sharing and renting vehicles on their own terms.

Erin Yurday

Erin Yurday is the CEO of NimbleFins. Prior to founding NimbleFins, she worked as an investment professional at TD Securities and a risk arbitrage hedge fund, and later as the finance expert in the case writing team at Stanford University's Graduate School of Business.

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