The carsharing market in Europe, since the last few years, has depicted commendable expansion, on account of the increased preference toward shared mobility in an economy plagued with soaring gas prices. The rising prevalence of erratic traffic jams resulting in increasing adoption of shared public and private transportation services has also been responsible for the growth of the Europe car sharing market.
Growing awareness about sustainable mobility backed by UN’s Sustainable Developments Goals (SDGs) will further complement the uptake of car sharing services across Europe.
As the population across developed countries in Europe is surging along with living standards, there will be a significant increase in demand for comfortable and hassle-free transportation services, which is further likely to impact the carsharing industry expansion. Based on statistics from the United Nations, the current population of Europe, as on January 2022, is 748,346,012. A considerable percentage of this population lives in urban areas, increasing the need for carsharing services.
Soaring adoption of carsharing services among businesses
Car sharing services are becoming highly popular among business organizations as a cost-effective alternative to running their own fleet. In this transportation system, companies allow employees to use vehicles on a sharing basis, which eventually helps them in minimizing costs. Growing necessity to minimize the overall organizational expenses and provide sustainable, safe, comfortable, and convenient transportation services to employees are advocating the adoption of rental cars among companies.
This is further supported by the stringent vehicle emission norms and soaring fuel prices across Europe. For instance, in January 2020, the EU passed CO2 emission performance standards for new passenger vans and cars to achieve their climate neutrality target by 2050.
What factors are driving the adoption of P2P car sharing services?
Peer-to-peer (P2P) car sharing services are witnessing significant adoption across Europe as they offer flexible pricing policy based on daily tariffs and a variety of vehicle and model options. This service provides a transportation mode for longer distances and hence, is widely adopted among tourists. According to the Centre for the Promotion of Imports (the Ministry of Foreign Affairs), in 2019, close to 496 million trips were recorded out of Europe (including air, land and sea). Europe was responsible for around 35% of the global international tourism expenditure that year.
As the governments across developed European countries are extensively emphasizing on boosting the regional tourism industry, by offering several tour packages and lifting international travel bans imposed due to the COVID-19 pandemic, the number of tourists is further expected to grow in the coming years.
P2P carsharing services are predicted to observe significant adoption owing to rising penetration of automobiles in the region. As per the European Automobile Manufacturers’ Association (ACEA), in 2020, approximately 10.8 million passenger cars were produced in EU, despite the negative impact of the COVID-19 pandemic on the automotive industry.
Growing popularity of free-floating car sharing model
Free floating car sharing model offers users the flexibility to pick up and return the vehicle anywhere within a certain city or area. This model is usually adopted as an alternative to taxi services for one-way trips, such as shopping and others. The growing trends of shopping and dining out are becoming highly popular across European countries owing to the significant increase in per capita income. Indeed, according to the World Bank, the GDP per capita income in the United Kingdom was recorded at around USD 41,811 in 2020. With increasing living standards and consequently rising one-way trips , the free-floating model is likely to pick up pace in the years ahead.
As compared to the station-based model, free-floating carsharing is much costlier and becomes even more expensive in case of traffic jams. However, in comparison with driving personal vehicles in erratic traffic jams, opting for a free-floating carsharing service could offer a hassle-free and affordable journey.
The onslaught of the COVID-19 pandemic led to several manufacturing shutdowns in Europe, leading to a major dip in production. That apart, the masses had suddenly begun to reject share mobility citing the issues of social distancing and hygiene, which led to Europe car sharing industry facing several roadblocks during 2020 and 2021. Despite the bleak situation during the pandemic, experts vouch that Europe car sharing market share is bound to witness an uptake in the years to come, driven by the rising need for sustainable transportation.