BMW and Daimler stated Wednesday they plan to leave the North American car-sharing market, with the joint venture partners stopping operations in Montreal, New York, Seattle, Washington, D.C., and Vancouver, as they concentrate on the European market.
SHARE NOW and its Car2Go unit, a joint venture of the two German automakers, are putting an end on their operations on February 29 in the United States and Canada, because of the “volatile state of the global mobility landscape,” and the expenses of operating in North America.
The company also stated it was stopping operations in three European cities, Florence, London, and Brussels. It stated that it would focus on “our remaining European cities in which we, along with our shareholders, believe show the greatest potential for profitable growth and mobility innovation.”
DriveNow, part of the combined company, started its operations in London in December 2014, but had to deal with “the hard reality that we could still not convince enough people to do so,” the company stated in announcing its exit from the UK market.
It is the recent sign of financial hardships in the broader mobility market and a setback to those who find car-sharing as a measure to decrease carbon pollution and congestion because unlike ridesharing services, the automobiles are not on the road between trips.
A 2016 study discovered that each U.S. Car2Go resulted between seven and 11 fewer privately owned vehicles.
Car2Go included 1 million North American members and 3 million globally.
The service permitted consumers to rent automobiles by the minute and park them on city streets or at parking meters with no charge. The service faced difficult competition from ride-hailing companies such as Uber Technologies, Lyft, and electric scooters.
In October, the companies shut down their operations in Denver, Austin, Texas; Portland, Oregon; and Calgary, and announced shutting Chicago operations.
In 2018, Daimler purchased Europcar’s remaining 25% stake in Car2Go for 70 million euros ($78 million). In 2018, BMW and Daimler merged their car-sharing units Car2Go and DriveNow along with ride-hailing, parking and charging services.