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A community kitchen in Rotherhithe has been delivering a large number of prepared dishes weekly for the past two years to elderly residents and vulnerable locals in south London. Yet, the group's plans face major disruption by the announcement that they will lose cars and vans on New Year’s Day.

This organization had relied on Zipcar, the car-sharing company that allowed its cars via smartphone. The company caused shock across London when it declared it would cease its UK operations from 1 January.

It will mean many helpers cannot collect food from a major food charity, which gathers surplus food from supermarkets, cafes and restaurants. Other options are further away, costlier, or do not offer the same flexible hours.

“The impact will be massively,” stated Vimal Pandya, the project's founder. “My team and I are worried about the operational hurdle we will face. Many groups like ours will face difficulties.”

“Knowing the reality, everyone is concerned and thinking: ‘How will we continue?’”

A Significant Setback for Urban Car-Sharing

The community kitchen’s drivers are among over 500,000 people in London registered as car club members, now potentially left without easy use to vehicles, avoiding the burden and cost of ownership. The vast majority of those people were likely with Zipcar, which held a dominant position in the city.

This shutdown, pending consultation with staff, is a serious setback to hopes that vehicle clubs in cities could reduce the need for private vehicle ownership. Yet, some analysts have noted that Zipcar’s departure need not spell the end for the idea in Britain.

The Potential of Shared Mobility

Car sharing is valued by city planners and environmentalists as a way of mitigating the ills associated with vehicle ownership. Typically, vehicles sit idle on the side of the road for the vast majority of the time, occupying parking. They also involve large CO2 output to produce, and people who do not own cars tend to use active travel and take public transport more. That benefits cities – reducing congestion and pollution – and improves people’s health through more exercise.

Understanding the Decline

Zipcar was founded in 2000 before being bought by the US car rental group Avis Budget in 2013. Zipcar’s UK income barely registered compared with its parent company's overall annual revenue, and a deficit that reached £11.7m in 2024 gave little incentive to continue.

Avis Budget has said the closure is part of a “broader transformation across our global operations, where we are taking deliberate steps to streamline operations, improve returns”.

Its latest financial reports said 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.

The Capital's Specific Challenges

Yet, industry observers noted that London has particular issues that made it difficult for the sector to succeed.

• Patchwork Policies: Across 33 boroughs, car-club operators face a patchwork of different procedures and costs that complicate operations.
• Congestion Charge: The closure coincides with electric cars becoming liable for London’s congestion charge, adding extra expenses.
• Parking Permit Disparity: Locals in some boroughs pay as little as £63 for a year’s electric car parking permit. A floating car club 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’re putting less polluting cars 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, 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.

“What we see is that car sharing around the world, especially in Europe, is expanding,” commented Bharath Devanathan of Invers.

He suggested authorities should start to view vehicle clubs as a form of public transport, and link it with train and bus stations. He added that one unnamed client was already seriously considering entering the London market: “There will be fill this gap.”

What Comes Next?

Other players can roughly be divided into two camps:

1. Fleet Operators: Which own or lease their own cars. This includes Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Peer-to-Peer Services: Which allow users to rent out their own vehicles via an app – similar to Airbnb for cars. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

One company, a US-headquartered peer-to-peer platform, is assessing the UK gap. Rory Brimmer, its UK head, said there was a “big opportunity” 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 some time for other players to build momentum. In the meantime, more people may choose to buy cars, and many across London will be without a convenient option.

For Rotherhithe community kitchen, the coming weeks will be a scramble to find a way. The logistical challenge caused by Zipcar’s exit highlights the wider implications of its departure on vital services and the prospects of shared mobility in the UK.