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Car-sharing in developing countries
Car-sharing in developing countries is a growing trend but still small. The research examined car-sharing in China, India, Brazil, Turkey and Mexico through literature reviews, expert interviews, and focus groups. Key findings include: market interest varies by location; car ownership aspirations and infrastructure pose barriers; but low car ownership and congestion provide opportunities. Focus groups in Bangalore and Hangzhou provided additional insights into user needs and potential impacts.
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Car-sharing in developing countries
- 1. Car-sharing in DevelopingCountries Clayton Lane Heshuang Zeng Chhavi Dhingra May 13th, 2014
- 2. Key question: iscar-sharing a feasible and sustainable mobility option in the developing countries? Project timeline: 2011/09-2013/09 Countries in focus: China, India, Brazil, Turkey, Mexico, South Africa Research team: • EMBARQ Global: Clayton Lane, Aileen Carrigan, Heshuang Zeng • EMBARQ India: Chhavi Dhingra, Rebecca Stanich Overview
- 3. Research Scope andMethodology Key Findings • Current Status • Barriers and Opportunities • Key finds by city • Bangalore: market interest, operation models, impacts • Hangzhou: market interest, operation models, impacts Outline
- 4. Current Status: • Therapidly growing trend • Increasing variety of Car-sharing services • Being Mainstreamed in developed countries (IPO/new players) Background: Car-sharing Worldwide (Data source: Shaheen and Cohen 2007, 2012)
- 5. Positive social andenvironmental impact in the established market (reduce VKT; delay or replace car purchase) Different context in terms of urbanization, motorization and transportation infrastructure Largely unknown in developing countries Is Car-sharing a Feasible Option? Region No. Vehicles Replaced Percent VKT Reduction North America 6 to 23 28 to 45% Europe 4 to 10 7.6 to 80% (Ave. 40%)
- 6. What if car-sharingis introduced here?
- 7. What if car-sharingis introduced here?
- 8. What is thecurrent state of the industry in developing countries? What are the potential markets? What are the main barriers and opportunities to implementation? How should car-sharing systems be designed? What might be the societal and environmental impacts? Research Questions
- 9. Methodology Literature Review • Overview onexisting knowledge • Assumption for expert Interview questions; Expert Interviews • Reached 26 interviewees in 11 countries • Current status update • Test the assumption of barriers and opportunities (CSOs) • Develop hypotheses to test for focus groups and Inform city selection Focus Groups • Test hypotheses from expert interview • Bangalore, India and Hangzhou, China • Collect fist-hand understanding from users’ perspective; Final Report • Report on “car- sharing in developing countries” • Presentation
- 10. Sources of Insights Mobilityexperts • literature review • expert Interviews Car-sharing operators (supply) • expert interviews; • focus groups Potential/existing users (demand) • focus groups
- 11. Hangzhou, China • 48participants • Young working professionals • 24 car owners, 24 non-car owners • 12 EVnet Members Bangalore, India • 44 participants • 27 IT professionals, or primary users; 17 secondary household members • 20 with access, 24 with no/limited access Focus Groups
- 12. Hangzhou • State capital,180 km from Shanghai • Population – 8.7 Million • GDP per capita: 12,320 USD • Modal split in 2000 – 42.8% bike, 22.25% bus , 27.6% pedestrian and private vehicles – 2.6% Hangzhou
- 13. • Capital ofthe state of Karnataka; • Population – 8.5 Million (2011) • GDP per capita: $3,963 • Modal split of motorized trips – public transport 42%, 2-wheeler 38%, auto-rickshaw 11%, and cars 9% Bangalore
- 14. Car-sharing Industry isvery small but growing fast; Market interest varies from place to place; Faces unique barriers and opportunities such as aspiration to car ownership/usage and congestion; Car-sharing operators adopt the existing business models to local context; Focus Groups identify new user requirements; Increase the access to auto mobility; Potential to delay/place car purchase plan in Hangzhou and to the less extent in Bangalore. Key Findings
- 15. Emerged recently –first CSO Zazcar (2009) Small, but growing very rapidly Activeness differs by region Mostly two-way systems Emergence of other related modes • ride-sharing, peer to peer (Brazil, China); • shared taxi (China); • with-chauffer car-rental, self-drive car rental, radio-rickshaw (India) • Uber (China, India, Brazil) Current Industry Status
- 16. Current Industry Status SystemName City Country Business Model Start date Fleet Size Membership Status Caronetas San Paulo Brazil ridesharing 2010 800,000+(15,0 00 active users) Operational Zazcar São Paulo Brazil 2-way 2009 60 3,200+ Operational Edoauto Beijing, China 2-way 2009 200+ 20,000+(*** active users) Operational Evnet Hangzhou China 2-way 2011 138 9915 Operational Rent-a-Reva Gurgaon India 2-way 2011 4 357 Cancelled Zoom Bangalore India 2-way 2013 50 7000 (3500 active users) Operational Carrot Mexico City Mexico 2-way 2012 60 2500+ Operational Ubicar Mexico City Mexico 2-way 2012 25 Operational Mobilizm Istanbul Turkey 2-way 2011 Operational Atlagit Istanbul Turkey 2-way 2010 2 55 Cancelled YoYo Istanbul Turkey 2-way Operational Date: January 2014 ( system in red are those we interviewed)
- 17. Barriers and Opportunities AreaBarriers Opportunities Potential Users • Strong aspiration for car- ownership • Unfamiliarity with CS service • Desire for car access Transportation Infrastructure • Congestion • Insufficient public transport infrastructure • Limited Parking for car- sharing • Low-car ownership rates • Poor taxi and rental car options (China) • Limited parking for private vehicles Governance • Lack of driving and criminal records and personal credit system; • Import taxes on vehicles; • Public policy unfamiliar with car-sharing • Car restriction affecting CSOs • Congestion- vehicle travel restriction • Air pollution – promote the clean vehicles • Improvement on public transport system Business • Contextualized operational technology unavailable • Limited access to capital • Low labor cost
- 18. Users – youngand well-educated/ non car-owners /median or lower-median income Trip types - weekend trips /occasional shopping and leisure/ business Market interest varies by region • Hangzhou – young working professionals • Bangalore – less interested than Hangzhou; but IT professionals with no or limited access show large interest Market potential influenced by the urban context – demand & supply Market Interest – Users and Trip Types
- 19. Some CSOs havedeveloped contextualized operation models. Modifications are key to success. Pricing Strategy: Distance-based gasoline charge + hourly rate, free membership, special package Respond to congestion: no return time/call in service. Localized technology (self-developed or purchased) Marketing and communication strategies Seek governmental support New financial model Existing Operation Models
- 20. Overall Market Interestin Bangalore 60 % of primary and 50% of secondary participants indicated that they would be interested in using carsharing services Those not in favor had preference to own vehicle or non-inclination to drive or perceived the car sharing process to be cumbersome. 17 9 10 8 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Primary Secondary Percentageofrespondents Would not be interested Would be interested
- 21. Market Interest byCar-ownership Vs. access In the primary group, out of 27 participants, 16 were car owners, however only 13 has access to a car when they needed it, whereas the remaining 14 did not. Similarly in the secondary group, though 15 of the 17 participants interviewed owned cars in their households, only 7 had access to it. 16 13 15 7 11 14 2 10 0 2 4 6 8 10 12 14 16 18 Owncars Haveaccess Owncars Haveaccess Non-owners No/limitedaccess Non-owners No/limitedaccess Primary Secondary Primary Secondary Numberofparticipants
- 22. Market Interest byCar-ownership in Bangalore Working professionals who did not own a vehicle had the maximum interest in using carsharing, followed by secondary members whose household already owned one car. Predictably, secondary members whose households had two cars, did not express interest in car sharing. 9 1 7 8 1 0 2 1 7 4 1 3 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Primary Secondary Primary Secondary Primary Secondary 0 1 2 Percentageofresponses Cars owned per household Would not use CS Would use CS
- 23. Preferred Potential Car-sharingTrip Types in Bangalore Primary users use cars followed by 2 W for almost all trips. Secondary users use cars followed by public transport, 3W and cabs. Leisure (including out of town) and shopping (trip chaining) were cited in majority (almost 70%) for carsharing. Work trips came third. Low preference for healthcare and education trips- possibly due to their urgent nature 14 17 3 9 1 Shopping Leisure Health Care Work Education
- 24. Operation Models –What else do Bangalore users want? “It should feel like a new car, not ‘somebody else’s’ car”. Strong preference amongst males for luxury vehicles and SUVs. Lukewarm response to Evs Willingness to walk up to 10 minutes to access a carsharing station Preferred location residential complexes, offices, airport, major public transit stations At around INR 200 (EUR2.8) per hour, the pricing competitive with hired taxis. Prefer distance to time-based 1 4 1 2 3 5 3 6 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Percentageofresponsesineach category Yearly household income Unacceptable Acceptable Acceptability of price of carsharing (2.8EUR/hour) in Bangalore
- 25. Social benefit ofincreasing users’ access Carsharing to avoid parking and maintaining hassels, etc. Current car owners did not wish to give up using their cars for carsharing and even if they did so, they didn't necessarily anticipate having to travel any less thereafter. 29% IT professionals, 31% secondary members would consider delaying (usually second) car purchase Uncertain impact on VKT, GHG emissions Overall on a national level, focusing on public transit, biking and walking infrastructure was identified a more pressing need than planning for carsharing systems ( view of experts and current focus of Government) Social and Environmental Impact - Bangalore
- 26. Most young workingprofessionals interested. Nearly ½ participants might use carsharing at least three times a month. Market Interest Users in Hangzhou Perception to Carsharing (will you try carsharing service) Estimated or current usage frequency Total Non Users No - 2 Potential Light Users Yes No more than once a month 12 Potential Moderate users Yes Between once to three times a month 11 Potential Heavy Users Yes At least three times a month 23 Table 1. Four types of users
- 27. Market Interest Usersin Hangzhou Non-car owners are more interested 0 2 1 11 5 6 18 5 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Non Car Owner Car Owner Non users Light users Moderate users Heavy users
- 28. Largest interest: medianand low-median income groups Market Interest Users in Hangzhou 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2501-5000 5001-8000 8001-11000 11001-13000 13001-18000 18001-23000 Pesonal monthly income (RMB/month) Non users Light users Moderate users Heavy users
- 29. Non-car owners seekauto mobility for weekend leisure trips Strong interest for hometown visit trips Less interest in shopping trips Competing modes: car rental and taxi Market Interest Trips in Hangzhou A summary of modal split of non-car owners (unit: # of participants) Trip types Personal mobility (rental car, car-sharing, borrow from friends) Taxi Bus Mixed modes Biking and/or walking commute 1 0 11 3 1 shopping 2 8 1 5 5 leisure 13 6 1 1 0
- 30. FOCUS GROUP FINDINGS Mostwant carsharing to be operated like bike-sharing; Easy access to stations - dense carsharing network well integrated with PT Preferences of vehicle types • Compact vehicles are acceptable for nearly half of participants • A variety of fleet or “bigger cars” options will be good – some want luxury cars for occasional usage • Most are open to EV/HEV, but mostly due to cost considerations Operation Models – What else do Hangzhou users want?
- 31. Social benefit ofincreasing users’ access Suggest delaying or replacing car ownership • Nearly half participants’ car purchase plans might be affected (17 delay & 5 replace); • Among 16 participants who recognized the status of cars, 1/2 might delay or replace vehicle purchase plan. Uncertain impact on VKT, GHG emissions • delay or replace car ownership • increase the usage of non car owners A way to introduce electric vehicles Social and Environmental Impact - Hangzhou
- 32. Hangzhou: Delay orReplace Car Purchase Plans Total # who would delay 1st vehicle purchase # who would replace 1st vehicle purchase # who would delay 2nd vehicle purchase # who would replace 2nd vehicle Car Owners 24 - 0 5(3) 2 Non Car Owners 24 12(6) 3 - - Potential large impact delay/replace 1st vehicle purchase in the household *the number in the () = the number of Evnet members.
- 33. Car-sharing Industry isvery small but growing fast; Market potential varies from place to place; Faces unique barriers and opportunities such as aspiration to car ownership/usage and congestion; Car-sharing operators adopt the existing business models to local context; Focus groups identify new user requirements; Increases access to auto mobility; potential to delay/replace car purchase plan in Hangzhou and to lesser extent in Bangalore. Key Findings
- 34. Thank you Clayton Lane,CLane@wri.org Heshuang Zeng, hzeng@wri.org Chhavi Dhingra cdhingra@embarqindia.org
- 35. Rapid urbanization andmotorization: • 600 million new urban population in India and China by 2030; • By 2030, light auto sales in China, India, and Brazil are expected to nearly double those sold in the U.S. and Europe combined. Asia, Africa and Latin America are home to over 75% of the world’s urban population but account for only 10% of the global car-sharing membership (mostly in Japan and Singapore). Opportunities in Developing Countries BACKGROUND
- 36. OUR SCOPE ANDMETHODOLOGY The 26 interviewees were grouped into three categories and covered the following geography Categories of expertise mobility experts Car-sharing operators others such as technology providers Regions: Brazil, China, India, Turkey, Mexico, and South Africa. U.S., Germany, France, Canada, and Singapore Expert Interview
- 37. Operation Models respondingto Barriers and Opps Barriers and opps on users Solutions • Unfamiliarity with car-sharing • Aspiration for vehicle ownership • Marketing and communication strategy (print-outs or online info on cost-saving and environmental benefits) • Price-sensetiveness • Pricing strategy (free membership, special package, distance combined with hourly rate) • Liability concern • Photo-taking at service, peer evaluation
- 38. Operation Models respondingto Barriers and Opps Barriers and opps on transit infrastructure Solutions • Limited parking • Working w/ real estate developers, industrial parks, universities • Seek for government support (Hangzhou and Mexico City) • Congestion • Allow flexible return time (Brazil); • Call-in service to change return time (China) • insufficient public transport infrastructure • Stations planed in transit-friendly neighborhood selectively • Arrange limited number of stations close to each other (Mexico City)
- 39. GOVERNANCE Operation Models respondingto Barriers and Opps Barriers and opps on governance Solutions • Lack of driving records • Test driving to check the driving skills • Lack of credit system • Pre-paid system and third party payment to overcome the lack of credit system (China) • High tax on vehicles • New financial model for vehicle selection and vehicle management (Brazil, China); • EV promotion • Apply EV fleet in Car-sharing service and seek for government support
- 40. BUSINESS Operation Models respondingto Barriers and Opps Barriers and opps on governance Solutions • no localized technologies available • Modify the technology (Brazil); • Self-develop the technology (China) • limited access to capital • Self- funded and start small • Seek to scale up when the business model is more mature
- 41. Hangzhou Fast urban expansion Fastmotorization - #of motorized Vehicles in 2011 reached 2.1 million Travel Restriction • Peak hour weekday travel restriction to keep one fifth of vehicles out of streets; • Travel restriction around West Lake to keep half vehicles out of west lake zone. Constructed urban area (square kilometer) # of motorized vehicles (million) 2001 180 0.39 2011 550 2.14
- 42. Carsharing and PTin Hangzhou Metro Bus Carsharing Parking Lot Public bike Station/lane s Highway entrance Sidewalk Overall Score 1.905 2.879 3.089 3.111 3.786 4.600 5.045 Overall order 1 2 3 4 5 6 7 Non Car Owner Score 2.318 2.467 2.435 3.176 3.929 5.600 5.300 NCO order 1 3 2 4 5 7 6 Car Owner Score 1.450 3.222 3.773 3.053 3.643 4.100 4.833 CO order 1 3 5 2 4 6 7 (Lower score indicates higher priority) Carsharing show great potential of fitting into Hangzhou’s public transport network.
Editor's Notes
- #26 CD
- #28 HS Perception to Car-sharing (Q: will you try car-sharing service) User type decided by estimated or current usage frequency Non users -no interested Light Users No more than once a month Moderate users Between once to three times a month Heavy Users At least three times a month Heavy users 18 out of 23 are non car owners Most members are heavy users (10/12) Note, we have 12 member participants, so the results in China might be more positive than the reality.
- #29 HS Test price for FG: The current price for carsharing in Hangzhou is 19-27 yuan (2.13-3.38 euro) per hour with the gas charge of 0.2 to 0.9 yuan/km (0.03-0.11 euro/km). 5 hour package – 5 hours 60 yuan, hourly rate is only 1.5 euro/hour. Income reveals as a key factor in determining the usage (note, aver. Income in Hangzhou is about 400 euro per month) Most of heavy users’ income are below 1375 euro/month – people with higher income tend to buy a personal vehicle and won’t use carsharing that often In the figure, the green bar indicates the income distribution of light users – people with income level higher than 1625 euro/month are all light users – this group are more likely to own a car.
- #30 HS Less demand for shopping trips in China is because the old city is usually compact and people can access to shopping area by bike or on foot; plus, taxi in Hangzhou is really cheap Competing modes: car rental and taxi Taxi is a competing mode to CS in occasional trips, Car rental is a competing mode to CS in weekend trips.