BMW enters London car sharing market after rival Daimler’s exit

DriveNow - BMW enters London car sharing market after rival Daimler's exit

BMW launched its car-sharing service in London, barely six months after rival Daimler said it was shutting its equivalent initiative in the UK.

Already in the United States, Germany and Austria, BMW’s DriveNow service operates in partnership with rental firm Sixt and allows users who pay a one-off registration fee to locate and open their nearest car by card or via a mobile phone app.

DriveNow will start in three boroughs in North London and customers will be able to return vehicles anywhere within the zone.

The scheme will begin operating with 210 BMW 1 series and Mini Countryman models, which will be joined by 30 electric i3 compact hatchbacks in the first quarter, BMW said in a statement. During the course of 2015, the automaker plans to expand its fleet in the capital to 300 cars.

In May, Daimler axed its Car2Go operation from the UK, citing the country’s strong culture and tradition of private vehicle ownership, though it continues to operate in cities around the world including Berlin and Rome in Europe and Washington D.C., Seattle and Austin in the U.S.

Peter Schwarzenbauer, BMW board member with responsibility for mobility services, told Reuters that the company had learned lessons in how to bring the scheme to London. The business has more than 360,000 customers worldwide.

“What we think we have to do differently is start on a smaller scale [and] prove the concept that this is something successful,” he said. “If you have proven it, then you can step by step grow this organically.”

Daimler found it difficult to coordinate its network of “free-floating” parking spaces across non-adjoining London authorities. BMW’s DriveNow hopes to avoid this problem by initially operating from only one zone in the north of the city.

Car rental firms and automakers are increasingly trying to tap in to the demand for flexible, short-term car use, particularly from younger people for whom car ownership is seen as less essential than it was in previous generations.

In March, French billionaire Vincent Bollore said he would bring 3,000 electric cars to London’s streets by 2016 as part of a car-share project that will emulate the city’s bike hire scheme.