Car share service Share Now, the company operating the Car2Go fleet, is closing down operations in North America.
In a statement posted Wednesday on Share Now’s website, the company said service will end on Feb. 29. An e-mail sent to customers said accounts will remain active until this date, and customers are encouraged to use any credits on their account.
“Please note that you may find fewer vehicles available as we approach that date,” Share Now’s e-mail said. “We are saddened by this decision and deeply apologize for the inconvenience this will cause you.”
Share Now’s statement said “rising infrastructure complexities," including increased competition, was part of the reason operations in North America are closing. Car2Go has been operating in Vancouver since 2011.
Vancouver resident Glen Murray said he uses Car2Go to travel around the city three to four times each week.
“I got rid of a car because there was car share,” Mr. Murray said.
Mr. Murray said he might use Evo, another car share service, or public transit after Car2Go becomes unavailable, but he may also consider getting a car again.
Sandra Phillips, who was the regional director for Car2Go when the company first launched in Canada, said Vancouver has always been a profitable market for car sharing. She is now the CEO and founder of Vancouver-based Movmi, a consultancy that helps launch car and bike sharing services.
Ms. Phillips said Car2Go’s free-floating model, where cars can be picked up and dropped off in different locations as opposed to specific lots, introduced “complexity and cost.”
“Car sharing in general, and shared mobility in general, is a tough business. It’s single-digit margins, even for the best in the market,” Ms. Phillips said. “While I may understand some of the logic in the news release for North America in general, I really don’t understand it for Vancouver.”
Ms. Phillips said the rise of ride-hailing and bike-sharing has caused an increase in competition in other North American cities.
However, Ms. Phillips said even in an area where there are competing transportation options for customers, more people will be drawn to using the services if they see a reliable volume of vehicles available. She calls this the network effect.
“I do understand competition is challenging and to a certain degree, during certain times, you lose some of the business that you used to have,” Ms. Phillips said. “But ultimately, in the long term, the network effect helps people to get rid of their cars and rely on [transportation sharing services].”
Tai Silvey, vice-president of Evo Car Share, expressed his sympathies for the staff, employees and members of Car2Go.
“It’s always good to have choice in a market, and there is a lack of choice after today, so it’s sad news on that front,” Mr. Silvey said.
Mr. Silvey said although it’s too soon to determine what this means for Evo, he wanted to confirm to the company’s members that Evo isn’t going anywhere.
“We are local, and committed to Vancouver and Evo is here for the long term.”
Car2Go will also cease operations in Montreal.
We have a weekly Western Canada newsletter written by our B.C. and Alberta bureau chiefs, providing a comprehensive package of the news you need to know about the region and its place in the issues facing Canada. Sign up today.