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Automotive sector considers options

News, 09 December 2014

LONDON: Leading automotive brands are exploring ways to adapt to what is expected to be a radically different future landscape where vehicle ownership is less highly prized among city dwellers.

New trials taking place in the UK point to a couple of possible models. Upmarket manufacturer BMW has teamed up with rental company Sixt to offer a one-way car-sharing facility.

DriveNow estimates that an average car is used only very infrequently – about 4% of the time – and believes that urban residents fed up with the expense of ownership and parking problems are open to alternatives.

The business, which already provides carsharing facilities in five German cities as well as Vienna and San Francisco, now plans on emulating London's cycle hire scheme, allowing users to pick up a vehicle in one place and drop it off in another.

Peter Schwarzenbauer, BMW board manager, said that a single shared vehicle could potentially replace dozens of cars. And he noted that it could also prove a useful marketing tactics. "The average age of our buyer is in their mid-40s," he told the Telegraph, "but the average age of a car sharing user is 32."

Alexander Sixt, managing director of the eponymous rental company was more bullish, hoping to "make mobility so cheap that only the rich will buy cars".

Jaguar Land Rover and Ford are involved in a completely different approach, partnering a new AutoDrive programme which is trialling battery-powered, self-driving pods in several UK cities, including Greenwich, Milton Keynes and Coventry.

Ultimately it is envisaged that passengers will be able to hail the pod like a taxi and pay £2 a trip through a mobile app.

The role of apps such as Uber also has to be factored into any future scenario planning, but Schwarzenbauer thought they could work together.

"I see them as partners – you might use one of our cars to drive to a restaurant and then use Uber to come home," he said. "The consumer is much more flexible in how they travel."

Uber's rapid rise has not been without setbacks. Most recently, one of its drivers in New Delhi has been charged with the rape of a female passenger and the authorities there have banned the service.

Data sourced from Daily Telegraph, Brand Republic, BBC'; additional content by Warc staff