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A volunteer food project in Rotherhithe has been delivering a large number of prepared dishes each week for the past two years to elderly residents and vulnerable locals in southeast London. Yet, their operations have been thrown into disarray by the news that they will lose cars and vans on New Year’s Day.

The group depended on Zipcar, the app-based vehicle rental service that customers to access its cars from the street. It sent shockwaves through the capital when it declared it would cease its UK business from 1 January.

This means many helpers cannot pick up supplies from the Felix Project, that collects surplus food from grocery stores, cafes and restaurants. Obvious alternatives are less convenient, costlier, or lack the same convenient access.

“It’s going to be affected massively,” said Vimal Pandya, the community kitchen’s founder. “My team and I are concerned by the logistical challenge we will face. Many groups like ours are going to struggle.”

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

A Significant Setback for Urban Car-Sharing

These volunteers are among over 500,000 people in London registered as car club members, who could be left without easy use to vehicles, avoiding the burden and cost of ownership. The vast majority of those members were probably with Zipcar, which held a dominant position in the city.

This shutdown, pending consultation with employees, is a serious setback to hopes that vehicle clubs in urban areas could reduce the need for owning a car. Yet, some experts also suggested that Zipcar’s exit need not mean the demise for the idea in Britain.

The Promise of Car Sharing

Car sharing is prized by many urbanists and environmentalists as a way of reducing the ills associated with vehicle ownership. Typically, vehicles sit idle on the street for 95% of the time, occupying parking. They also involve large carbon emissions to produce, and people without a vehicle tend to use active travel and take transit more. That helps urban areas – reducing congestion and pollution – and improves public health through increased activity.

What Went Wrong?

Zipcar was founded in 2000 before its acquisition by the American rental giant Avis Budget in 2013. Zipcar’s UK income were minimal compared with its owner's overall annual revenue, and a deficit that grew to £11.7m in 2024 gave no reason to continue.

The parent company stated the closure is part of a “broader transformation across our international business, where we are taking deliberate steps to simplify processes, enhance profitability”.

Its latest financial reports said revenues had declined as drivers took fewer and shorter trips. “These changes reflect the ongoing impact of the cost-of-living crisis, which continues to suppress demand for discretionary spending,” it said.

London's Unique Hurdles

Yet, several experts noted that London has specific problems that made it much harder for the sector to succeed.

• Inconsistent Rules: With numerous local councils, car-club operators face a mosaic of varying processes and costs that complicate operations.
• New Costs: The closure coincides with electric cars becoming liable for London’s congestion charge, adding unavoidable costs.
• Parking Permit Disparity: Locals in some boroughs pay just £63 for a year’s electric car parking permit. A similar shared vehicle would pay over £1,100 per year, creating a major disincentive.

“We should literally be charged one-twentieth of a private parking cost,” argued Robert Schopen of Co Wheels. “We’re taking cars off the street. We introduce cleaner models in their place.”

A European Example

Nations in Europe offer models for London to follow. Germany enacted national car-sharing legislation in 2017, providing a unified system for parking, subsidies and exemptions. Now, the country has several shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK trails at 0.7.

“The evidence shows is that car sharing around the world, particularly on the continent, is expanding,” said Bharath Devanathan of Invers.

Devanathan said authorities should start to view vehicle clubs as a form of public transport, and integrate it with train and bus stations. He added that a potential operator was looking at entering the London market: “Operators will fill this gap.”

The Future Landscape

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

1. Fleet Operators: Which maintain their own cars. This includes 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. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

Turo, a US-headquartered P2P service, is already weighing up the UK gap. Rory Brimmer, its UK managing director, said there was a “significant chance” to win more users. “There is a void that is going to need to be filled, because London still needs to move,” Brimmer said.

However, it could take a while for other players to build momentum. For now, more people may feel forced to buy cars, and many across London will be left without access.

For Rotherhithe community kitchen, the coming weeks will be a rush to find a way. The delivery problem caused by Zipcar’s exit underscores the broader impact of its departure on vital services and the future of car-sharing in the UK.