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A volunteer food project in Rotherhithe has been delivering hundreds of prepared dishes each week for the past two years to pensioners and needy locals in south London. However, their operations have been thrown into disarray by the news that they will not have cars and vans on New Year’s Day.

This organization depended on Zipcar, the app-based vehicle rental service that customers to access its cars from the street. The company sent shockwaves across London when it said it would shut down its UK operations from 1 January.

This means many helpers cannot pick up supplies from the Felix Project, which gathers excess produce from supermarkets, cafes and restaurants. Other options are less convenient, more expensive, or lack the same convenient access.

“It’s going to be affected massively,” stated Vimal Pandya, the community kitchen’s founder. “Personally me and my team are concerned by the logistical challenge we will face. Many groups like ours will face difficulties.”

“Knowing the reality, everyone is concerned and thinking: ‘How are we going to carry on?”

A Major Blow for Urban Car-Sharing

These volunteers are among over 500,000 people in London who were car club members, who could be left without easy use to vehicles, without the hassle and cost of ownership. The vast majority of those people were probably with Zipcar, which had a near-monopoly position in the city.

This shutdown, pending consultation with staff, is a serious setback to hopes that car sharing in cities could cut the need for owning a car. However, some experts also suggested that Zipcar’s exit need not spell the end for the concept in Britain.

The Promise of Car Sharing

Shared vehicle use is valued by city planners and green advocates as a way of reducing the problems linked to vehicle ownership. Most cars sit idle on the side of the road for 95% of the time, using up space. They also require large CO2 output to produce, and people who do not own cars tend to use active travel and take transit more. That benefits cities – reducing congestion and pollution – and improves people’s health through increased activity.

Understanding the Decline

Zipcar was founded in 2000 before its acquisition by the US car rental group Avis Budget in 2013. Zipcar’s UK income were minimal compared with its owner's total earnings, and a loss that grew to £11.7m in 2024 gave little incentive to continue.

The parent company stated the closure is part of a “wider restructuring across our global operations, where we are taking deliberate steps to simplify processes, improve returns”.

Zipcar’s most recent accounts noted revenues had fallen as drivers took fewer and shorter trips. “This trend reflect the ongoing impact of the economic squeeze, which is dampening demand for discretionary spending,” it said.

London's Unique Hurdles

However, several experts noted that London has specific problems that made it difficult for the sector to succeed.

• Patchwork Policies: With numerous local councils, car-club operators face a patchwork of different procedures and costs that complicate operations.
• New Costs: The closure coincides with electric cars start paying London’s congestion charge, adding unavoidable costs.
• Unequal Parking Fees: Locals in some boroughs pay as little as £63 for a annual electric car parking permit. A similar shared vehicle would pay over £1,100 annually, creating a significant barrier.

“We should literally be charged one-twentieth of a resident’s permit,” argued Robert Schopen of Co Wheels. “We remove vehicles. We’re putting less polluting cars in their place.”

Lessons from Abroad

Nations in Europe offer examples for London to follow. Germany enacted national shared mobility laws in 2017, providing a unified system for parking, support and exemptions. Now, the country has 5.4 shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK lags behind at 0.7.

“The evidence shows is that shared mobility around the world, particularly on the continent, is growing,” said Bharath Devanathan of Invers.

Devanathan said authorities should start to treat car sharing as a form of public transport, and integrate it with train and bus stations. He added that a potential operator was already seriously considering entering the London market: “There will be fill this gap.”

The Future Landscape

The company’s competitors can be split into two camps:

1. Fleet Operators: Which maintain their own cars. Examples Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Person-to-Person Rentals: Which allow users to rent out their own vehicles via an app – a kind of Airbnb for cars. Players include Britain’s Hiyacar and the US’s Getaround and Turo.

Turo, a US-headquartered P2P service, is assessing the UK gap. Rory Brimmer, its UK head, said there was a “significant chance” to win more users. “A space exists that is going to need to be filled, because London still needs to move,” Brimmer said.

Yet, it could take a while for other players to establish themselves. For now, more people may feel forced to buy cars, and others across London will be left without access.

For Rotherhithe community kitchen, the next month will be a rush to find a way. The delivery problem caused by Zipcar’s exit underscores the wider implications of its departure on community groups and the prospects of car-sharing in the UK.