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Car-Sharing: Where and How It Succeeds (2005)

Chapter: Chapter 2 - State of the Practice

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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
×
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Suggested Citation:"Chapter 2 - State of the Practice." National Academies of Sciences, Engineering, and Medicine. 2005. Car-Sharing: Where and How It Succeeds. Washington, DC: The National Academies Press. doi: 10.17226/13559.
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Page 2-1 Car-Sharing: Where and How It Succeeds CHapter 2. State of tHe praCtICe 2.1 What is Car-Sharing? Car-sharing has appeared in numerous different forms throughout North America and the world. The term has encompassed open-ac- cess shared vehicle programs, intended for occasional trips where a car is needed; station cars for commuters to drive to work from the transit station; and systems for intra-campus mobility, for example in a university setting. While differing markedly in their objectives, business model, tech- nology and target market, these programs share most, if not all, of the following features: • An organized group of participants • One or more shared vehicles • A decentralized network of parking locations (“pods”) sta- tioned close to homes, workplaces and/or transit stations • Usage booked in advance • Rentals for short time periods (increments of one hour or less) • Self-accessing vehicles It is important to distinguish car-sharing from ridesharing or car- pooling, given some international discrepancies in terminology. In the United Kingdom, the term “car-sharing” refers to the shared use of vehicles at the same time – known as carpooling or ridesharing in North American parlance. In British usage, the term “car club” is generally used to denote the practice of sharing vehicles rather than rides (Exhibit 2-1). Exhibit 2-1 Car-Sharing and Car Club Terminology Definition North American Usage (in this report) British Usage Vehicles owned by a separate or­ ganization and shared between a number of different users, who may use them at different times Car­sharing Car clubs Privately owned vehicles shared for a particular trip Carpooling, ridesharing Car­sharing

Chapter 2 • State of the praCtiCe September 2005 Page 2-2 Definitions Rather than a formal definition, most published work provides a descrip- tion of car-sharing. This description can acquaint readers with a perhaps unfamiliar concept and be as inclusive as possible in embracing a wide variety of programs. In some cases, however, a precise definition has been needed, generally when a partner organization has wished to provide zoning incentives, tax breaks or other forms of support for car-sharing. For example, the City of Toronto adopted a definition in 2000 in order to grant on-street parking permits to AutoShare. In these instances, car-sharing needs to be defined as a category of services or vehicles, rather than naming a specific operator. Rydén & Morin (2004) argue that, in Europe, a legally valid definition of car-sharing is “probably the most important legal issue” to help establish and expand car-sharing. It can pave the way for on-street parking bays, a common road sign, and taxation and planning incentives. An alternative approach, taken by the City of Seattle, is to specify a “City- recognized car-sharing program” in the ordinance (Seattle Municipal Code § 23.54.020). This gives the City the freedom to extend the support to all op- erators that meet its standards, without the need for a formal definition. Exhibit 2-2 provides some examples of car-sharing definitions adopted or proposed by various agencies. The common themes are: (i) requirements for users to be members; (ii) access to a common fleet; (iii) billing in hourly increments; and (iv) exclusion of traditional car rentals. The State of Wash- ington definition provides the most concise, effective way to address all these points and is a recommended model for other entities as a standard, common definition. Importantly, it explicitly provides for business and other organizational members, as well as individuals. It defines car-sharing as: A membership program intended to offer an alternative to car ownership under which persons or entities that become members are permitted to use vehicles from a fleet on an hourly basis.

September 2005Page 2-3 Car-Sharing: Where and How It Succeeds Exhibit 2-2 Car-Sharing Definitions Organization Definition Source North American City of Toronto Carsharing is the practice where a number of people share the use of one or more cars that are owned by a profit or non­profit carsharing organization. To use a vehicle a person must meet the membership requirements of the carsharing organization, including the payment of a membership fee that may or may not be refundable. Cars are reserved in advance and fees for use are normally based on time and miles driven. Carsharing organizations are typically residentially based with cars parked for convenient access within the area of the membership served by the organization. City of Toronto, 2000 State of Washington A membership program intended to offer an alternative to car ownership under which persons or entities that become members are permitted to use vehicles from a fleet on an hourly basis. Revised Code of Washington § 82.70.010 (5) State of Oregon A program in which drivers pay to become members in order to have joint access to a fleet of cars from a common parking area on an hourly basis. It does not include operations conducted by a car rental agency. Oregon Administrative Rules 330­090­ 0110 (7) (Business Energy Tax Credit) District of Columbia Car­sharing vehicle – any vehicle available to multiple users who are required to join a membership organization in order to reserve and use such vehicle, for which they are charged based on actual use as determined by time and/or mileage. District of Columbia Municipal Regula­ tions, § 9901 State of Minnesota (Pending Legislation). Note that this only includes 501(c) nonprofit opera­ tors. A “carsharing organization” means an organization that: (1) is described in section 501(c) of the Internal Revenue Code; (2) is comprised of members who purchase the use of a motor vehicle from the organization; (3) owns or leases a fleet of motor vehicles that are available to members of the organization to pay for the use of a vehicle on an hourly or per trip basis; and (4) does not assign exclusive rights of use of specific vehicles to individual members or allow individual members to keep a vehicle in the member’s sole possession. Senate Bill SF1229 (Dibble), as introduced 84th Legislative Session (2005­2006) European Belgium (Draft) Car vehicles put at the disposal of members against payment for a limited duration of use according to contractual conditions determined by [the car­sharing organization], to the exclusion of car rental and leasing. Rydén and Morin (2004) Swedish National Road Adminis­ tration (Draft) Car­sharing means that a number of persons share the use of one or more cars. Use of a car is booked beforehand, the user paying a fee based on the distance driven and the length of time the car was made use of. Although this is similar in some ways to traditional car rental, it differs in the possibility it provides of booking a car for short periods of time and in the rental agreement being made for an extended period of time, rather than each time a car is used. In addition, each household has its own set of keys, and cars are placed in the vicinity of where members live. In the case of company car­sharing, the keys and the cars are being readily available at the place of work. “Key” is here equal to smartcard or similarities. Vägverket, 2003

Chapter 2 • State of the praCtiCe September 2005 Page 2-4 accreditation Alternatively, some municipalities and other organizations – mostly in Eu- rope – have developed accreditation programs. Rather than developing an inclusive definition, these accreditation criteria are deliberately exclusive: they explicitly aim to exclude car-sharing operators that do not meet mini- mum standards. As well as the operational aspects of car-sharing, they often cover environmental objectives. For example, they may prescribe maximum vehicle emissions levels or require that mileage fees be assessed separately from hourly charges, which may discourage users from driving more than absolutely necessary. Two examples include “Der Blaue Engel” (“Blue Angel”) program in Ger- many and criteria from the Swedish National Road Administration. Such accreditation programs are always a trade-off between raising the bar for operators, and being too severe. The German criteria, for example, have perhaps proved too stringent and have excluded many car-sharing opera- tors in that country (Rydén & Morin, 2004). Der Blaue Engel, Germany The German “Blue Angel” environmental labeling program details several criteria for the accreditation of car-sharing operators, as follows:1 • Open to all, subject to credit and driving record checks • Minimum of 10 participants per vehicle • 24-hour vehicle booking, pick-up and return • No minimum booking length above one hour. The rate per hour must not be more than 15% of the daily rate. • Charges levied on the basis of time and distance • Regular care and maintenance of the vehicles in accordance with the manufacturer’s recommendations • Compliance with all legal safety requirements • Compliance with European emissions standards and noise limits Sweden The Swedish National Road Administration argues that basic criteria are needed, in case “fictive car-sharing” programs are established to take ad- vantage of special benefits offered to genuine car-sharing operators. These are proposed as follows (Vägverket, 2003): 1. Basic Criteria for the Award of the Environmental Label Car Sharing RAL-UZ 100. Accessed May 19, 2004 at www.blauer-engel. de/englisch/produkte_zeichenanwender/vergabegrundlagen/ral.php?id=20.

Page 2-5 Car-Sharing: Where and How It Succeeds • An administrator • At least six drivers per car (after one-year start-up time) • Adequate accounting practices • Ownership by a legal entity • Vehicle requirements (e.g. age, safety rating) 2.2 a Brief History2 early programs Early attempts to establish car-sharing programs can be traced back as far as the 1940s, to the “Sefage” program in a housing cooperative in Zurich, Switzerland, which opened in 1948. Other European programs in subsequent decades included “Procotip” in Montpelier, France, starting in 1971; Witkar, Amsterdam, which opened in 1973; “Green Cars” in various places in Britain in the late 1970s; and “Vivalla Bil” in Örebro, Sweden, opening in 1983. In the United States, meanwhile, Purdue University researchers ran the Mo- bility Enterprise program in West Lafayette, Indiana, from 1983 to 1986. In San Francisco, the Short-Term Auto Rental Service (STAR) was established as a demonstration project by a private firm and ran from 1983 to 1985. While all could be considered car-sharing programs, the form and technology used varied considerably. Procotip, an early attempt at using technology to enable members to pay for usage by distance, used in-vehicle “meters” fed by tokens. Witkar used electric vehicles, and users were limited to the city center. The STAR program served residents of a large apartment complex near San Francisco State University. The Purdue University experiment focused on encouraging participants to use smaller, fuel-efficient cars, and reduce their need to own additional vehicles, rather than dispensing with vehicle ownership altogether. Partici- pants were provided with a small “minimum attribute vehicle” for daily trips, as well as access to a shared fleet of special purpose vehicles such as large sedans and station wagons. (Doherty, Sparrow & Sinha, 1987) What these early programs did have in common, however, is that almost all folded after a short period of time, usually within a few years. A range of reasons has been cited for their failures, including inadequate planning, 2. For a more detailed history of car-sharing, the reader is referred to Shaheen, Sperling & Wagner (1998), and Britton (1999b). For more details on the European history of car-sharing, see Harms & Truffer (1998). Much of this section is based on these references.

Chapter 2 • State of the praCtiCe September 2005 Page 2-6 marketing, and financial management; the small size of the service area or membership base; and lack of support from local governments. In many cases, the projects may have been overly ambitious given the technology available at the time (Harms & Truffer, 1998; Cousins, 1999). One of the few detailed post-mortem evaluations to be published examined the STAR service in San Francisco, which had mixed results, the researchers concluded. It was successful from a consumer perspective, and improved the mobility of participants while reducing their auto ownership needs. However, it did not succeed financially, with specific issues including vehicle reliability, a pricing structure that encouraged long- as well as short-term rentals, and a growing number of members who failed to pay their bills. (Cambridge Systematics, 1986) recent Growth Car-sharing in its current form has its roots in Switzerland and Germany, where programs date back to the late 1980s. The first large-scale car-sharing programs began in Switzerland in 1987 with the independent founding of two cooperatives. These later merged to form Mobility Switzerland, which is still one of the largest car-sharing operators in the world. A year later, in 1988, StattAuto Berlin was founded, and, over the next decade, car-sharing programs began in other European countries, particularly the Netherlands and Austria. By 2004, there were approximately 70,000 car-sharing members in Germany alone, with a further 60,000 in Switzerland. One estimate puts worldwide car-sharing member numbers at 200,000, with a yearly increase of 20-30% (Schwieger, 2004). An estimate from February 2005 suggests that there are about 280,000 worldwide members, with nearly 75% of these in Europe (Shaheen, personal communication). The concept was slower to arrive in North America. The first formal car-shar- ing program began in Quebec City in 1994, with the launch of Auto-Com, the predecessor to Communauto. In the United States, a small operator – Dancing Rabbit Vehicle Cooperative – opened in 1998, as part of an “eco- village” in Rutledge, MO. The first large-scale US program, CarSharing Portland (subsequently sold to Flexcar), also opened for business in 1998, and the early years saw rapid, almost exponential growth in the number of members, vehicles and organiza- tions (Exhibit 2-3). By December 2004, 61,652 members were enrolled in the United States, sharing 939 vehicles, while 10,759 members and 528 vehicles

Page 2-7 Car-Sharing: Where and How It Succeeds were enrolled in Canada (Susan Shaheen, unpublished data). Car-sharing in North America is now available in 15 metropolitan regions, plus a number of smaller communities (Exhibits 2-4 and 2-5). Planning is under way in several more, such as Detroit and Minneapolis-St Paul where programs are scheduled to launch in 2005. As of April 2005, Washington, DC was the only region where operators (Flexcar and Zipcar) competed directly for members. Other regions, such as San Francisco and Toronto, have had brief periods of competition. However, both Flexcar and Zipcar have publicly stated that they are looking to expand in new markets, including those where there is an incumbent operator. Exhibit 2-3 US Car-Sharing Growth This report focuses on car-sharing; however, mention should also be made of bicycle-sharing programs. Typically, they allow a user to pick up a bicycle and drop it off at any rack within a defined zone, usually within a downtown. The concept has evolved into technologically advanced “public-use bicycle” systems, which have used electronic locks with card access to address earlier issues of theft. The programs can be operated by a transportation agency, as with German rail operator Deutsche Bahn through its Call-A-Bike initiative, or an advertising firm. The greatest success has been in Europe, particularly 0 15,000 30,000 45,000 60,000 75,000 1998 1999 2000 2001 2002 2003 2004 M em be rs 0 200 400 600 800 1000 Vehicles Members Vehicles Source: Shaheen, Schwartz & Wipyewski (2004); Susan Shaheen, unpublished data. Note that 2004 data are for December, while 1998-2003 figures reflect June data points, meaning the chart overstates the rate of increase from 2003 to 2004.

September 2005Page 2-8 Car-Sharing: Where and How It Succeeds Exhibit 2-4 North American Car-Sharing Regions (June 2005)

Page 2-9 Car-Sharing: Where and How It Succeeds Germany and Scandinavia; in 2004, the largest program was Call-A-Bike in Berlin with 1,700 bicycles (DeMaio & Gifford, 2004). 2.3 Models of Car-Sharing Car-sharing is a broad concept that encompasses a variety of different busi- ness and operational models. This section outlines the different models that exist in North America, from the point of view of organizational structure and operational model. In many respects, these models are closely bound with the geographic context and the target market, both of which are discussed in Chapter 3. For example, rural car-sharing organizations tend to be organized differ- ently – perhaps on a cooperative or voluntary basis – and have a different operational model than those in major urban centers. organizational Structure Car-sharing operators in North America have adopted a range of organiza- tional forms (Exhibit 2-5). The three main types are: • For-profit. Most of the largest operators in North America are privately held, for-profit companies. Examples include Flexcar, Zipcar, and Communauto (which was originally founded as a cooperative, Auto-Com). • Non-profit. These operators are incorporated as tax-exempt 501(c)(3) organizations. Examples include City CarShare in San Francisco, and PhillyCarShare in Philadelphia. • Cooperative. Operators such as the Cooperative Auto Network in Vancouver, BC are run by members, who join by purchasing a “share” in the organization. In practice, this share acts in a similar way to the refundable deposits charged by for-profit and non- profit operators. Alternatively, but less commonly, a car-sharing operation may be run as a research pilot by universities such as the University of California at River- side, or by a municipal government. Roaring Fork Valley Vehicles in Aspen, CO is the closest North American example to government-run car-sharing; while the organization is formally a separate non-profit, the City of Aspen provides a staff member to run the operation. However, there are several European examples of transit agencies running car-sharing programs, no- tably in Italy.

Chapter 2 • State of the praCtiCe September 2005 Page 2-10 Exhibit 2-5 North American Car-Sharing Operators (June 2005) Region Operator Type United States Ann Arbor, MI Ann Arbor Community Car Coop Cooperative Aspen, CO Roaring Fork Valley Vehicles Municipal Boston, MA Zipcar For­profit Boulder, CO Boulder CarShare Non­profit Chapel Hill, NC Zipcar For­profit Chicago, IL I­GO Non­profit/ Franchise Detroit, MI Viacar For­profit Eugene, OR Eugene BioCarShare Cooperative Irvine, CA (University of California) ZevNet Research Pilot Los Angeles, CA Flexcar For­profit Madison, WI Community Car For­profit* Minneapolis­St Paul, MN (Planned 2005) hOurCar Non­profit New York, NY (including New Jersey suburbs and Princeton, NJ) Zipcar For­profit Philadelphia, PA PhillyCarShare Non­profit Portland, OR (includes Vancouver, WA) Flexcar For­profit Riverside, CA (University of California) Intellishare Research pilot Rutledge, MO Dancing Rabbit Vehicle Cooperative Cooperative San Diego, CA Flexcar For­profit San Francisco, CA City CarShare Non­profit Santa Barbara, CA Flexcar For­profit Seattle, WA Flexcar For­profit Washington, DC Flexcar, Zipcar For­profit Canada Calgary, AB Calgary Alternative Transportation Coop Cooperative Edmonton, AB Carsharing Co­op of Edmonton Cooperative Gatineau, QC Communauto For­profit** Guelph, ON Guelph Community Car Co­op Cooperative Kingston, ON Kingston Carshare Cooperative Cooperative Kitchener, ON People’s Car Cooperative Montreal, QC Communauto For­profit** Nelson, BC Nelson CarShare Cooperative Cooperative Ottawa, ON VrtuCar For­profit Quebec City, QC Communauto For­profit** Sherbrooke, QC Communauto For­profit** Toronto, ON AutoShare For­profit Vancouver, BC Cooperative Auto Network Cooperative Victoria, BC Victoria Car Share Cooperative Cooperative * Community Car was founded by the non-profit Madison Environmental Group. **Communauto started as a cooperative, Auto-Com.

Page 2-11 Car-Sharing: Where and How It Succeeds One of the most important differences among these organizational forms relates to the source of capital and funding. For-profit operators often have access to venture capital, or other sources of private start-up funding. Non- profits are often better placed to tap into government funding, and their tax- exempt status means that they can obtain foundation grants. Cooperatives tend to be partly dependent on their members to provide capital. Other differences among the different organizational models have also been suggested. For example, non-profits and cooperatives may not have the in- centive to expand as much as a for-profit enterprise, while a for-profit may not be the best model to achieve narrowly stated environmental objectives such as vehicle trip reduction (Brook, 2004). For example, several non-profits argue that their rate structures are set to discourage unnecessary auto use, through charging for each mile driven rather than “bundling” packages of hours and miles (see Pricing in Section 2.5). Several partner agencies have expressed a preference to work with non-profits for this reason; non-profits can also be easier to support, since their tax status can defuse community objections to “privatizing street space” when granting on-street parking for car-sharing (Chapter 5). However, for-profits suggest that they are achieving similar environmental objectives – “doing good by doing well.” Introduction of car-sharing to new geographic areas has usually resulted from the establishment of a new, local organization, or expansion by an established operator. Flexcar, for example, is based in Seattle, but also runs programs in Portland, San Diego, Los Angeles, and Washington, DC. Bos- ton-based Zipcar has operations in the New York City and Washington, DC regions, along with separate campus programs at Princeton University, NJ and the University of North Carolina-Chapel Hill. Replication and Franchising A recent development has been the introduction of franchising, outsourcing and replication programs. Flexcar, for example, runs the Flexcar Network, under which local operators such as I-GO in Chicago contract with Flexcar for provision of vehicles, technology and back-office functions such as billing. According to Flexcar, franchising makes particular sense in smaller markets, where the company may not wish to pursue operations of its own. In Canada, Communauto has developed its bilingual Réservauto system, which is de- signed to be adaptable to the needs of other car-sharing operators. San Francisco-based City CarShare, meanwhile, has a national replication program to provide technical assistance to non-profit operators in other

Chapter 2 • State of the praCtiCe September 2005 Page 2-12 regions. PhillyCarShare, for example, was established with this support. In 2005, City CarShare launched a handbook to assist start-up car-sharing operators, covering a range of detailed operational and business planning issues (City CarShare, 2005). Franchising and similar arrangements are perhaps best developed in Eu- rope. For example, Germany-based Cambio began operating in Aachen and Bremen in 1990. Since then, it has developed joint-venture partnerships to provide services in four additional cities in Germany and Belgium and has a “service relationship” providing software and a call center for operators in seven others. The company provides direct service to 12,800 custom- ers, and reservation and service functions for 4,800 more (Schwartz, 2005). In Italy, meanwhile, Iniziativa Car Sharing (ICS) is the direct provider of technology and support services, including a national call center. ICS is a consortium of 18 cities and provinces, funded by the Ministry of Environ- ment, but individual operators come from both the public and private sec- tors (Mastretta, 2005). operational Model A fundamental difference has been pointed out between two types of shared vehicle programs: car-sharing (sometimes called “neighborhood” car-shar- ing) and station car programs. While neighborhood and employment-based car-sharing programs are the focus of this report, it is important to explain how these programs relate to station cars. Neighborhood Car-Sharing Neighborhood car-sharing is the basic model that is the main subject of this report, including programs that focus on the employment as well as the resi- dential market. The “neighborhood” term is sometimes used to distinguish it from other shared vehicle programs, such as station cars. Station Cars In contrast to car-sharing, which serves a wide variety of trips, station car programs focus on the link between the transit station and the home and/or the workplace. They provide a car at the “home end” of the trip, allowing a commuter to drive to the station in the morning in order to take transit for the line-haul part of the journey to work. The same car is then used by an arriving rail passenger to drive the “last mile” of the journey to a workplace beyond walking distance from transit. Under some more recent pilots such

Page 2-13 Car-Sharing: Where and How It Succeeds as CarLink in the San Francisco Bay Area, the car is also available for em- ployees during the working day. The same trips then happen in reverse in the evening, with the car stored overnight at the residence of the “home end” user (see, for example, Katzev, 2003; Bernard, 2003; Shaheen et al., 2004). The main difference between car-sharing and station cars is perhaps to be found in the types of users and trips served, with station cars focusing on the commute market with payment by monthly subscription (Exhibit 2-6). In addition, station cars have a defined set of users – one home-based com- muter, one work-based commuter, and, in some recent models, midday users. Each car-sharing vehicle, on the other hand, serves a much wider member base, and payment is generally per-use. In contrast to station cars, this ar- rangement has also helped car-sharing companies earn enough revenue to continue with little or no subsidy. Until the late 1990s, station cars accounted for the majority of shared-use vehicles and members in the United States. Since then, however, they have been outpaced by the growth in car-sharing. The number of station car pro- grams appeared to peak in 2002, and only two remained in 2003 (Shaheen, Schwartz & Wipyewski, 2004). However, some car-sharing operators have been integrating variants of station car-type programs into their regular fleet, blurring the differences between the two. For example, Flexcar has several weekday van shuttles in Portland, OR, that link the Westside MAX light rail line to employment sites for firms such as Norm Thompson Outfitters. These vans have no defined “home end” user, but are available for all Flexcar members at evenings and weekends. These types of programs are discussed in more detail in the employer and transit agency profiles in Chapter 5. Although the transit link is less direct than with station cars, most car-sharing programs have located vehicles close to transit from their inception. Transit stations provide a good environment – not just because of the possibility of combined transit–car-sharing trips, but because they often have higher densities, local shops and services and act as a neighborhood center. Chapter 3 discusses the market settings for car-sharing in more detail.

Chapter 2 • State of the praCtiCe September 2005 Page 2-14 Exhibit 2-6 Station Car Comparison to Car-Sharing Characteristic Station Cars Car-Sharing Types of Trip Served Primarily journey to work. Under more recent pilots, some midday use. Generally all trips for which a car is required, except the regular journey to work for which it is not cost effective Trip Frequency Daily commute to work Occasional trips; varied usage patterns Number of Users 1­4 per vehicle* 20­66 per vehicle** Linkage to Transit Vehicles used primarily as an extension of fixed­route transit Vehicles often stationed at transit stations and accessed by transit, but most trips not linked to transit Where Based Different locations at differ­ ent times (home, workplace, transit station) Generally single “home” base Price Structure Subscription­based Usage­based * The CarLink II program in Palo Alto, CA had 19 vehicles and an average of 77 users, although some cars had more users (home­based, work­based and midday) (Shaheen, Schwartz & Wipyewski, 2004). Most station car programs have fewer users, since they do not provide for midday use. In December 2004, US station car programs claimed approximately 130 members and 106 vehicles, giving a ratio of 1.2 members per vehicle (Shaheen, unpublished data). ** As of December 2004, US car­sharing programs claimed 61,652 members sharing 939 vehicles, with 10,759 members sharing 528 vehicles in Canada (Shaheen, unpublished data). Informal Car-Sharing Small car-sharing programs do not necessarily need to be run on a formal basis. In many cases, neighbors, friends or family members can share a car, either through informal arrangements or more detailed agreements on cost sharing, reservations and maintenance. Some developments have also incorporated shared cars, such as the Gaia Building in Berkeley, CA, with two electric vehicles available for residents’ use as well as City CarShare service in the building (Exhibit 2-7). Indeed, the philosophy of several of the founders of early Swiss car-shar- ing programs was that cars – and, for that matter, other long-lasting consumer goods – should be shared between a small “user group” of about a dozen families and maintained by volunteer labor (Harms & Truffer, 1998). The main administrative difference between informal car-sharing programs and their more formal counterparts relates to the incorpora- tion of a separate car-sharing organization. Also, formal organizations often provide access to a much larger network of vehicles. However, it is important to recognize that some of the formalized car-sharing programs discussed in this report rely to varying degrees on volun- teer labor. Exhibit 2-7 Electric Vehicles in the Gaia Building Berkeley, CA, 2002 Photo: Panoram ic Interests

Page 2-15 Car-Sharing: Where and How It Succeeds 2.4 relationship to other Modes Car-sharing has sometimes been referred to as the “missing link” in the pack- age of alternatives to the private automobile (for example, Britton, 1999a). In other words, transit, taxis, cycling and walking can often meet most mobility needs, but there may still be other trips for which a private car is required. Car-sharing, under this hypothesis, can fulfill these needs and allow users to do without a private car, or a second car (see Chapter 5). Exhibit 2-8 shows how car-sharing relates to other transportation modes. It provides options for mid-distance trips where flexibility is required – for example, in carrying packages, or reaching destinations that may not be accessible by public transportation. The remainder of this section discusses the differences between car-sharing and the two closest substitutes – rental cars and taxis. In some cases, the main difference between the three modes relates to the cost of a trip. Since most car-sharing operators charge by hours reserved, and in some cases distance driven as well (see Pricing in Section 2.5), car-sharing is most cost-effective for intermediate length trips. For longer trips, rental cars are usually cheaper, since they tend to be priced by the day and offer unlimited mileage. For short distance but long duration trips – for example, where the car-sharing vehicle must be parked, with charges accruing, at the destination for a long period – taxis tend to be cheaper. Exhibit 2-9 shows cost comparisons based on San Francisco taxi fares, rental car rates and car-sharing tariffs. Exhibit 2-8 Relationship to Other Modes FDJPIDMBEPNFFS'MBEPNFFSG FDJPID TUDBQNJ XFO HOJSBI4SB$ ZHPMPOIDFU MBEPNSFUOJ TFDJWSFT HOJSBI4SB$ OPEOP-OJ GM FY JC MJU Z OF FE FE MFWBSUGPFDOBUTJ% JYB5 FLJ# OPJUBUSPQTOBS5DJMCV1 MBUOF3SB$ HOJSBI4SB$ FMPSTUJPUSBDFIUTFDVEFSHOJSBI4SB$ Source: Schwartz, Joachim. Presentation at Car-Free Cities Working Group Seminar, London, 1999.

Chapter 2 • State of the praCtiCe September 2005 Page 2-16 Exhibit 2-9 Cost Comparisons for Rental Cars, Taxis and Car-Sharing Source: Cervero & Tsai (2003). rental Cars Three key differences distinguish car-sharing from traditional car rentals, its closest equivalent: short-term rentals; a decentralized, self-accessing network of vehicles; and the bundling of gasoline and insurance into rates. In addition, the primary purpose of car-sharing is often to provide an alter- native to vehicle ownership. In contrast, most rental firms have centralized facilities, particularly in air- ports and downtowns, require a staff member to check the vehicle out, and offer minimum rental increments of 24 hours. As a result, rental firms tend to cater far more to business travelers and other visitors, and people who need a replacement car, rather than occasional, short-duration trips by local residents – the core market for car-sharing operators. 14 1-Hour Lease Figure 6. Comparative Costs of City CarShare Leases Versus Costs for Other For-Hire Carriers: Scenarios for Leases of 1-, 4-, 7-, and 10-Hour Durations Over Distance Ranges $- $10 $20 $30 $40 $50 $60 $70 $80 0 20 40 60 Distance (Miles, Round Trip) ts oC lat oT Taxi Rental Car CarShare Taxi CarShare $- $10 $20 $30 $40 $50 $60 $70 $80 0 20 40 60 Distance (Miles, Round Trip) ts oC lat oT Taxi Rental Car CarShare Taxi CarShare $- $10 $20 $30 $40 $50 $60 $70 $80 0 20 40 60 Distance (Miles, Round Trip) sts oC lat oT Taxi Rental Car CarShare Taxi Rental CarCS $- $10 $20 $30 $40 $50 $60 $70 $80 0 20 40 60 Distance (Miles, Round Trip) ts oC lat oT Taxi Rental Car CarShare CarShare 4-Hour Lease 1-Hour Lease 7-Hour Lease 10-Hour Lease

Page 2-17 Car-Sharing: Where and How It Succeeds Indeed, most car-sharing operators have collaborative arrangements with local rental car firms, encouraging members to use rental cars for longer trips. City CarShare members in San Francisco receive discounts with Enterprise, for example, while AutoShare members in Toronto receive discounts with four rental firms, including Budget and Enterprise. In the longer term, however, there may be greater convergence between the rental car and car-sharing models, and many examples point this way already. At Stanford University, for example, Enterprise now offers hourly rentals (see Section 5.9, Universities). In Europe, car rental firms often operate car-sharing programs themselves. Avis runs one in London, while Hertz started its “Delebilen” service in Co- penhagen in 1998. In Austria, Denzeldrive provides both car-sharing and rental cars using a common fleet of 750 vehicles. According to Bergmaier et al. (2004), Denzeldrive is blurring the two concepts; the main differences are in the pricing structure, minimum duration, and the use of the membership joining fee as a barrier to infrequent renters using the cheaper car-sharing service instead of rental cars. In addition, a new rental car business model by EasyRentACar in Europe may pose a direct challenge to car-sharing operators, through offering short-term reservations, unstaffed pick-up locations, and a demand-based pricing system. While this approach was driven by cost cutting concerns, the end product bears many similarities to car-sharing. (Meaton, Starkey & Williams, 2003) The reverse is also true to some extent, as car-sharing operators offer daily and weekly rates that in many ways compete with the rental car offering. Communauto in Quebec, for example, offers a “network rate” with a flat charge per day and 300 km of inclusive mileage, and a “workweek rate”, in addition to its standard hourly rates. These rates allow the operator to maximize utilization, and appeal to different market segments – such as freelance workers who need a car every day, but only for a few weeks at a time. Depending on availability, these daily and weekly rentals are fulfilled with Communauto cars, or with an equivalent vehicle from a rental company partner. (Robert, 2000)

Chapter 2 • State of the praCtiCe September 2005 Page 2-18 taxicabs Early car-sharing programs were sometimes referred to as “self-drive taxis," and the most obvious difference between the two concepts is that taxis in- clude a driver. This difference makes taxis suitable for several types of trip that are not permitted or cost-competitive with car-sharing: • One-way trips. As discussed in Section 2.5, car- sharing vehicles must usually be returned to the same location where they were picked up. • Short-distance, long-duration trips. The user must pay for car-sharing reservations while the car is parked at the destina- tion. This can make taxis more cost-effective for long meet- ings, concerts and other short-distance, long-duration trips. • Trips by users who cannot drive. Car-sharing operators are generally selective about their members, requiring a rela- tively clean driving record as well as a valid license, and usu- ally imposing minimum age restrictions of 21 years. Taxis, on the other hand, carry almost all passengers, including those too young to drive, people with disabilities, drivers with sus- pended licenses, and those who are temporarily intoxicated. • Out-of-town trips. One of the largest markets for taxis is out-of- town visitors. Car-sharing is less suitable for this group of poten- tial users, since they tend to be unfamiliar with local geography and will not be in town long enough to justify membership. However, the two US car-sharing organizations with operations in more than one region, Flexcar and Zipcar, allow members to use cars in any city. In addition, two nonprofits, PhillyCarShare and San Francisco-based City CarShare, have a cross-usage agree- ment. Vrtucar in Ottawa has similar agreements with AutoShare in Toronto and Communauto in Montreal and Quebec City. 2.5 Current practice Customer Groups Most car-sharing operators offer services to two distinct customer groups – personal users and business users. Personal users join as an individual or household and use car-sharing vehicles for similar purposes as they would a private car. Most car-sharing growth, particularly in the early stages, can be attributed to personal users. Business users join in order to make car-sharing vehicles available to their employees. Businesses may be interested in car-sharing for several reasons (Brook, 2004), to:

Page 2-19 Car-Sharing: Where and How It Succeeds • Replace, partially replace or augment an existing fleet • Replace or partially replace car rentals or reimbursement for em- ployees using their own cars • Replace subsidized employee parking • Provide an incentive not to drive to work, by making a car avail- able for trips during the working day • Save on parking charges for employees who drive to work In most cases, business members use car-sharing services in the same way as personal users. However, some operators offer more tailored programs for business users. Flexcar, for example, allows car-sharing vehicles at or near a firm’s office to be reserved exclusively for employees of that firm, either during the working day (“semi-exclusive”) or at all times (“exclusive”). As well as allowing car-sharing to tap a new market segment, business members have an important role in smoothing demand patterns throughout the day, and allowing operators to maximize utilization. Most companies tend to use the vehicle during the working day, rather than at evenings and weekends when individual demand peaks (for example, Reutter & Böhler, 2000). pricing Actual rates vary considerably between different operators, and the national operators such as Flexcar and Zipcar charge different rates in different re- gions. However, most charge for usage on the following basis: • Per hour reserved. • Per mile driven. Some operators bundle a certain number of miles into the hourly rate but charge for additional miles. • Monthly or annual administrative charge. • Application fee. • Penalty fees. These are often assessed for late returns, late cancel- lations, parking vehicles in the wrong location, and other viola- tions of terms of service. (Conversely, some operators provide credits for members who wash the car or undertake other tasks.) • Refundable deposit. Not all operators charge this, and some use a credit check instead. For cooperatives, the purchase of a member- ship share generally serves as a deposit.

Chapter 2 • State of the praCtiCe September 2005 Page 2-20 The relationship between these charges is a difficult balancing act, and no pricing structure will benefit all users. A high hourly rate and low mileage fee will benefit those who make longer trips but do not leave the car parked for long periods – for example, dropping off a relative at the airport. A low hourly rate and high mileage fee, in contrast, will make shorter-distance, longer-duration trips more cost effective. Similarly, the level of monthly or annual fee will determine how administra- tive costs are allocated between frequent and occasional users, and whether car-sharing is attractive for those who need it as “mobility insurance.” When CarSharing Portland introduced a membership fee in 2000, for example, about 30% of the members left. However, revenue changed little, since most were infrequent users (Brook, 2004). Many operators have introduced more sophisticated pricing mechanisms, in order to make car-sharing financially attractive to as many people as possible. Another aim of these different packages has been to maximize utilization, encouraging greater use of under-utilized vehicles and at off-peak times. The different approaches have included: • Off-peak discounts. Most operators offer free or discounted us- age at night. For example, City CarShare provides a 50% discount on the hourly fee between 10 PM and 10 AM. Flexcar offers free hourly usage for members on prepaid plans between 11 PM and 7 AM, although mileage charges accrue. • Maximum daily rate. Most operators cap the daily rate at a certain level. The Cooperative Auto Network charges a maximum $20 daily rate, and Communauto has a $12.50-$16.50 daily ceiling.3 Zipcar’s daily rates vary depending on vehicle and region, but are typically $60-$75. Flexcar designates a certain number of “Free- dom” vehicles each month, for which daily charges are capped at 5 or 10 hours of usage. • Different tariffs. Operators such as Vrtucar and AutoShare offer different membership plans depending on frequency of use. Occa- sional users can choose a plan with a low monthly fee and higher hourly or mileage fee, or a higher monthly fee and lower hourly and mileage rates. 3 Note that all prices are expressed in US dollars, using the March 2005 rate of $1.215 Canadian to $1 US.

Page 2-21 Car-Sharing: Where and How It Succeeds • Bundled plans. Flexcar offers plans that provide a certain number of hours and miles for a fixed monthly fee – for example, 10 hours and 300 miles for $80 per month.4 These are similar to cellphone plans, in that unused hours do not roll over to the next month, and any additional usage is charged for at a slightly higher hourly rate. Zipcar has similar “monthly commitment” plans, which of- fer discounted rates and waive the annual fee, with extra usage charged at standard rates. Some higher-value plans allow mem- bers to roll over unused credit for one to two months. There is great potential to use sophisticated, differential pricing mechanisms to maximize revenue and utilization, through encouraging usage at off-peak times and at under-utilized vehicle locations. Similar systems are used by most airlines. Differential pricing has also been proposed as a mechanism to rectify vehicle imbalances in systems where one-way trips are allowed (see Innovative Services in Section 2.6). In these cases, cheaper rates would encourage users to pick up a vehicle at a location with a surfeit of vehicles, and return it at another (for example, Schwieger, 2004). On the other hand, such pricing conflicts with the desire to keep rate schedules as simple and comprehensible as possible, particularly in order for consumers to be able to make decisions on the relative costs of car-sharing compared to other transportation modes. Exhibit 2-10 shows some of the different pricing plans offered by different operators. This table is not comprehensive, but rather aims to give examples of how monthly, hourly and mileage rates are packaged in different plans. The exhibit also provides costs for some sample trips. Where a range is given for a single operator, the exact cost depends on the chosen rate plan. Higher-usage rate plans will tend to work out cheaper per trip. The Cana- dian operators have the lowest rates. Of the US operators included in this comparison, Roaring Fork Valley Vehicles in Aspen and, for longer-dura- tion, lower-mileage trips, City CarShare in San Francisco, have the lowest per-trip rates. However, these operators also have higher application and membership fees, which are not considered in the sample trip costs. 4 Rate in Portland, OR as of March 2005.

September 2005Page 2-22 Car-Sharing: Where and How It Succeeds Exhibit 2-10 Sample Rate Structures Operator Sample Prices Sample Trips Groceries (1 hr, 5 miles) Airport (4 hrs, 75 miles) Hiking (8 hrs, 25 miles) City CarShare, San Francisco $10 monthly fee, $4 per hour ($2 off­peak), $0.44 per mile $6.20 $49.00 $43.00 Flexcar, Portland Regular Plan – $35 annual fee, $9 per hour. Each hour includes 30 miles – $0.35 per additional mile Bundled Plan – for example, $35 annual fee, $80 per month including 10 hours and 300 miles. Additional hours at $8.50, including 30 miles. Other bundled plans range from $42.50 to $700 per month, including 5­100 hours and 150­3000 miles $7.00­$9.00 $28.00­$36.00 $56.00­$72.00 I­GO, Chicago Regular Plan – $6 per hour plus $0.50 per mile Bundled Plans ­ $85­$225 per month, including 10­25 hours and 100­250 miles $8.50 $53.50­$61.50 $60.50 Roaring Fork Valley Vehicles, Aspen $10 monthly fee, $3.50 per hour, $0.20 per mile. Fixed daily rate of $60 $4.50 $29.00 $33.00 Zipcar, Boston Regular Plan – $50 annual fee, $8.50­$12.50 per hour depending on vehicle, plus $0.20 per mile after 125 included miles Monthly Commitment – Minimum $50­$250 monthly charge pro­ vides 10­15% discount, and waiving of annual fee. $7.23­$8.50 $28.90­$34.00 $51.00­$65.00 AutoShare, Toronto Simple Plan – $0 per month, $6 per hour, $0.20 per mile Advantage Plan – $20.50 per month, $4.30 per hour ($3.50 off peak), $0.20 per mile $5.31­$6.96 $32.19­$38.77 $39.54­$52.70 Communauto, Quebec Plan C – $29 per year, $1.65 per hour ($1.20 off peak), $0.37 per mile (first 62 miles of trip), $0.24 per mile (subsequent miles) Plan A – $288 per year, $1.65 per hour ($1.20 off peak), $0.20 per mile $2.64­$3.50 $21.49­$32.71 $18.14­$22.44 Cooperative Auto Network, Vancouver High Usage – $33 monthly fee, $1.65 per hour, $0.24 per mile Lower Usage – $5 monthly fee, $1.65 per hour, $0.50 per mile $2.84­$4.16 $24.47­$44.33 $19.13­$25.75 Source: Car-sharing operator websites, March 2005. All prices in US dollars, using an exchange rate of US$1 = CN$1.215. Note that most operators offer many more different pricing plans than those listed here. Sample trip calculations assume daytime weekend rates with a standard vehicle, and do not include membership fees, reservation fees or other administrative charges.

Page 2-23 Car-Sharing: Where and How It Succeeds Vehicles Most car-sharing operators provide services with a core fleet of four-door compact cars, such as Honda Civics or the Scion xA. However, most of the larger operators also make a range of specialty vehicles available to their members, for example to haul large loads. Most commonly, these are pickup trucks or minivans. However, Zipcar in Boston also provides higher-end vehicles (at a higher price) such as BMW 325s, and SUVs such as Ford Es- capes, Honda Elements and Toyota Highlanders. The fleet composition for a selection of operators is shown in Exhibit 2-11. Exhibit 2-11 Sample Fleet Composition Operator Core Fleet Other Vehicles Used City CarShare, San Francisco Scion xA Scion xB VW Beetle VW Jetta (wagon) Honda Civic/Civic Hybrid VW Golf Toyota Tacoma Toyota Prius I­GO, Chicago Honda Civic/Civic Hybrid Honda Element PhillyCarShare, Philadelphia Toyota Prius Toyota Matrix Scion xB Toyota Tacoma Roaring Fork Valley Vehicles, Aspen Ford Focus Zipcar, Boston VW Jetta Ford Focus Honda Civic Toyota Matrix Scion xB Ford Escape Scion xA Toyota Prius Volvo S40 BMW 325 Mazda 3 Mini Honda Element Toyota Sienna Toyota Rav 4 EV Toyota Tacoma Toyota Highlander AutoShare, Toronto Toyota Corolla Toyota Echo Suzuki Aerio BMW 3 Series Dodge Cargo Lexus ES 330 Communauto, Quebec Toyota Echo Toyota Tercel Vrtucar, Ottawa Toyota Echo Toyota Matrix Chevrolet Astrovan Source: Car-sharing operator websites, March 2005.

Chapter 2 • State of the praCtiCe September 2005 Page 2-24 Clean-fuel technology has been of particular interest to many car-shar- ing operators. Usually, this has been introduced through gasoline-electric hybrids, which offer improved fuel-economy compared to conventionally fueled vehicles. Most of the larger operators have some hybrids, typically a Toyota Prius or Honda Civic. In the case of PhillyCarShare, hybrids account for half of the fleet. The Dancing Rabbit Vehicle Cooperative in Rutledge, MO, meanwhile runs its fleet on biodiesel, and BioCarShare in Eugene, OR has a single car that also runs on biodiesel. However, a program by Zipcar in Denver, using compressed natural gas (CNG) vehicles, was abandoned due to the limited fueling infrastructure; according to Zipcar, members did not want to drive across town to the CNG station. Battery electric vehicles have also been used, but typically for station car programs and research pilots such as IntelliShare at UC-Riverside, or for limited programs where outside funding has been made available specifically for the vehicles. For example, the IntelliShare research program mainly uses Honda Electric EV+ vehicles. Zipcar has received donated RAV-4 electric vehicles from Toyota, while City CarShare previously operated Ford Th!nk City vehicles following a grant from Weststart-Calstart. Most mainstream operators, however, have been reluctant to place electric vehicles into their fleets, due to higher operational costs, the limited range of the vehicles, and the downtime required for recharging. City CarShare (2005) puts battery electric vehicles in the category of “what not to do” in its guide for starting up a car-sharing organization, due to cost and reliability issues. “In summary, the huge advantages of electric vehicles in terms of emissions reductions have to be set against the cost and practical draw- backs,” it says, suggesting that gasoline-electric hybrids may be a better fit for car-sharing at present. Schwieger (2004, p. 127) concurs, pointing out: “The combination of electric vehicle and car-sharing appears as a ‘dangerous’ combination of two difficult topics. The failure of one part determines the fate of the other, despite the fact that they might be successful if they were brought on to the markets as independent products and services.” Operators and their partners also face current difficulties in procuring elec- tric vehicles. For example, the planned Montréal program – a partnership between Communauto, Agence Métropolitaine de Transport and other agencies – is now intending to use hybrids instead.

Page 2-25 Car-Sharing: Where and How It Succeeds technology Most earlier car-sharing programs, in both Europe and North America, pro- vided members with universal door keys or relied on the manual, physical “lock box” model of access. For example, the keys for each car might be contained in a wall-mounted safe at each location, which members could access with a master key or personal identification number (PIN). Users telephoned a live operator to make a reservation, and obtained their vehicle key through a self-service, manually controlled key locker. Billing was based on the honor system, with users filling out a trip log including mileage. (Shaheen, Sperling & Wagner, 1998) Even in the late 1990s, manual systems were the norm, and manual key lock- ers are still used in many European countries (Traue, 2001). Recently, how- ever, the largest North American operators – along with the newer entrants to the European market – have transitioned to automated reservations and access systems. These systems allow the user to reserve a car online; open the doors with a smart card or electronic key fob (or, in the case of Helsinki, Finland, with a mobile telephone); and drive off, sometimes after entering a PIN. Time and mileage are recorded automatically. The development of advanced technology has been cited as one of the key factors allowing the recent growth in car-sharing. Manual systems offer significant disadvantages at scale, such as a lack of accuracy for reserva- tions and billing, and vandalism and theft (Shaheen, Sperling & Wagner, 1998). Automated systems, in contrast, streamline routine tasks – particu- larly reservations – and allow a smaller staff to concentrate on higher-level functions. The components of modern car-sharing technologies generally include (adapted from MOSES, 2004): • Reservation management system. This allows reservations to be made, modified and cancelled. Various interfaces allow access by call center or customer service staff, and directly by members via the web (Exhibit 2-12) and, in some cases, an automated voice-acti- vated telephone system. The telephone service can be particularly useful for extending a current reservation while the member is on the road. • Member database. This contains contact information, marketing preferences, date joined, and other information specific to each member. • Fleet and parking system. This component identifies the types of vehicles in the fleet, and their locations.

Chapter 2 • State of the praCtiCe September 2005 Page 2-26 • Invoicing. • Other components. These may include tariff management, a commercial database, performance reporting, emergency manage- ment, system configuration, and so on. Exhibit 2-12. Most North American operators now have advanced web-based reservations systems. These examples are from City CarShare (left) and Zipcar. In addition, each car is equipped with an on-board computer and access control mechanism. These handle functions such as access – including, if desired, verifying that the user has a valid registration – and recording time or mileage. Some operators also equip their cars with a Global Positioning System (GPS) device, which allows vehicles to be located in the event of theft, late return, or being parked in the wrong location. Despite these general common features, technologies vary markedly be- tween different operators, and there is little standardization to date (see, for example, Shaheen, Meyn & Wipyewski, 2003). There are several competing “off-the-shelf” commercial systems, while some operators have developed their own proprietary technology and in some cases licensed this to other operators.

Page 2-27 Car-Sharing: Where and How It Succeeds 2.6 Market Development The early growth of car-sharing in Europe and North America was based on the neighborhood residential model. In other words, the primary customers were individual households, with cars located in primarily residential or mixed-use areas. The residential market still forms the largest market for many operators. However, operators are experimenting with a range of different business models, some of which have the potential to yield much greater revenue. At the same time, innovative services such as one-way reservations have been explored, which have the potential to reduce the “convenience gap” between car-sharing and car ownership. product Life Cycle Wagner (2005; personal communication) identifies several distinct car-shar- ing “products.” His analysis in Exhibit 2-13 categorizes them in two ways: their historical development and the degree to which they are profitable. The products on the left of the chart, such as neighborhood car-sharing and alternative fuel vehicles, were the earliest to be introduced. Those to the right, such as Public Car (which would allow non-members to access car-sharing vehicles with a smart card such as a credit card), represent potential future developments. The other axis represents net revenue, with the products towards the top of the chart being the most profitable ventures. Business car-sharing and fleet-sharing, for example, have generated the most net revenue, and are likely to become even more profitable in the future. The profitability of neighborhood car-sharing is also expected to increase. Alternative fuel vehicles, in contrast, have generally been loss-making ventures (or covered through external subsidies). While this analysis is based on the European experience, it bears a strong resemblance to that in North America. Several products worth particular mention are discussed individually below.

September 2005Page 2-28 Car-Sharing: Where and How It Succeeds Exhibit 2-13 Car-Sharing Product Life Cycle 1990-2005 Source: Adapted from Wagner (2005). evitanretlA selciheV leuF doohrobhgieN gnirahS-raC lanoitan aiv cilbuP tropsnarT / lacoL aiv lanoigeR tropsnarT kniL liaR aiv repoleveD )gnisuoh( ni pohS / pohS esneciL + - 5002 ot pu euneveR emit reyolpmE aiv setiS + raC cilbuP teelF gnirahS ssenisuB gnirahs-raC erutuf raen elbatiforP lartuen-euneveR gnikam-ssoL raChsaC

Page 2-29 Car-Sharing: Where and How It Succeeds Business Car-Sharing This concept is discussed from the perspective of employer and business partners in Chapter 5. From an operator’s point of view, business car-shar- ing can be one of the most attractive market segments, particularly where there is also a residential market that will use the cars in the evenings and weekends. For example, Flexcar’s expansion in Southern California has tar- geted the business sector. Rather than needing to sign up every individual, a single “sale” to a company brings in many individual users, some of who may also join for personal use. Fleet Sharing Fleet sharing is a variant of business car-sharing, which provides an organiza- tion with exclusive use of car-sharing vehicles at particular times. (In contrast, most business car-sharing members use the regular car-sharing network in the same way as other members.) For example, the City of Berkeley has ex- clusive use of four City CarShare vehicles during the working day (Chapter 5). The Postal Service in Switzerland uses 6,000 cars between 4 AM and 11 AM, and is working to substitute 10% of this fleet with car-sharing vehicles (Wagner, personal communication). Fleet sharing provides the customer with the assurance that it will have access to the vehicles, and is financially advantageous for the operator since it guarantees a revenue stream. Developers This market includes residential, commercial and mixed-use properties and is discussed in detail in Chapter 5. From the operator’s perspective, this approach provides both parking and, perhaps more importantly, ready access to tenants to market the service, particularly if membership fees are included. There is also the prospect of developer subsidies helping to make car-sharing work in more peripheral locations. One major US opera- tor believes that this sector is the next large growth market in car-sharing, following business car-sharing. Several operators have recently had great success in negotiating agreements with developers and planning bodies. Due to the nature of the development pipeline, however, it may take several years before these are completed. Lease Sharing Under this concept, an individual leases a vehicle, but makes it available to other car-sharing members when not needed (for example, when travel- ing away from home), via the common reservation system. Depending on utilization, the member receives a rebate on lease costs.

Chapter 2 • State of the praCtiCe September 2005 Page 2-30 The largest trial of lease sharing was the “Cash Car” project in Germany from 1998 to 2003. This did not continue after the pilot, largely due to transactional costs such as cleaning the vehicle (Wagner, personal com- munication). However, it may have considerable future potential in more peripheral neighborhoods, where a “full-time” car-sharing vehicle may not be warranted. A much smaller number of members – perhaps one to four – are needed to make lease-sharing economically viable, compared to 25 or more per vehicle for car-sharing. Through restricting usage to a small num- ber of users in a “cell” (such as a gated community or apartment building), members could also personalize the vehicle with their own Kleenex, CDs and so on, Wagner suggests. Innovative Services The other aspect of market development relates to the provision of innova- tive services. All large car-sharing organizations in North America at pres- ent offer only two-way trips for fixed-period reservations. In other words, the user must reserve a car, drop off the vehicle at the same location where it was picked up, and specify an end time for the reservation (which often may be extended, if the car is available). There are several practical and economic reasons for this: • It allows the reservations process to function, since the system knows when and where a car will be available. • It avoids staff time in “shuttling” cars from one location to another to address distribution imbalances. • It enables members to easily find the car and know where it is located. • It allows a single parking space to be allocated for each car at its “home” location. In contrast, systems that allow for one-way trips need around twice as many reserved parking spaces as vehicles, in order to function optimally (Nakayama, Yamamoto & Kitamura, 2002). Alternatively, they need to be located in places that have a reserve of free parking (Schwieger, 2004); however, as discussed in Chapter 3, such plans are unlikely to provide the most fertile ground for car-sharing. These restrictions, on the other hand, also serve to reduce the utility of car- sharing and make it less attractive to potential members. During the focus groups conducted for this study (described in Chapter 3), one of the main disadvantages of car-sharing was considered to be the lack of a one-way trip option. In addition, many disliked the “clock-watching” involved with car-

Page 2-31 Car-Sharing: Where and How It Succeeds sharing. They said that, if their plans changed or they got stuck in traffic, they were stressed over thinking “I’ve got to get that car back.” It reduces their level of spontaneity, participants considered. Three specific services have been explored, which can be implemented singly or in combination, as ways to overcome these barriers: • Instant access. Members can go directly to an available vehicle, without needing to make a reservation. (Most operators already have an approximation of this convenience, through allowing reservations by phone or internet within five minutes of the start time.) • Open-ended reservations. Members schedule the pick-up time but can keep the car for as long as needed. • One-way trips. Members can drop the car off at a different car- sharing location. Floating cars, an extension of the one-way trip concept, allows members to drop the car off anywhere within a defined zone. This is similar to the free “public-use bicycle” pro- grams discussed earlier in Recent Growth, Section 2.2. One-way trips and open-ended reservations have been implemented, but only in research pilot programs where financial considerations are less im- portant. For example, UC-Riverside’s IntelliShare program provides vehicles that can be driven between five stations on and around campus. When mak- ing an (optional) reservation or picking up a vehicle, the computer system asks the user for the station where the vehicle will be dropped off (Barth, Todd & Xue, 2004). Other examples include the French Praxitele demonstra- tion, which ran from 1997-1999, and a pilot with StattAuto in Berlin. In most cases, about one in ten trips requires a staff member to relocate the vehicle (Barth & Todd, 2001; Schwieger, 2004). The Berlin project was based within an existing car-sharing fleet, allowing the impacts to be studied and compared to more conventional car-sharing operations. Vehicle utilization increased by 23% with the open-ended return system, and 15% of reservations were one-way trips. However, the increased utilization did not lead to gains in revenue, since many users simply kept the vehicle once they had reached the daily rate cap, rather than driving it more. One-way and open-ended reservations were seen by members as “good to have,” rather than as essential features of a car-sharing program (Schwieger, 2004).

Chapter 2 • State of the praCtiCe September 2005 Page 2-32 Schwieger suggests that these “second generation” services, along with others such as floating cars (which are not assigned to any particular lo- cation and can be picked up and dropped off anywhere within a defined geographic zone), are important to maintain membership growth. Rather than providing a simple add-on to existing operations, he concludes that they provide an opportunity to relaunch the entire concept. According to Schwieger & Wagner (2003), open-ended car-sharing makes car-sharing as convenient as car ownership; the ability to make one-way trips gives car- sharing even greater flexibility. Indeed, open-ended reservations are particularly promising once vehicle locations grow large enough to be able to support open-ended as well as fixed-reservation vehicles. This would address one of the key downsides of car-sharing – the lack of flexibility should travel plans change. However, the likely increased costs and additional complexities – particularly for one-way trips – mean that some operators may continue to focus on the basic business model, and leave taxis to serve the one-way trip market. One car-sharing founder suggests that “it is important to avoid getting caught up in the technology craze.” Car-sharing, he recommends, should focus initially on markets that can be served cost-effectively, and avoid the cost and distraction of advanced features that, while perhaps desirable, are not necessary to serve the core market. (Robert, 2000) references Barth, Matthew and Todd, Michael (2001), “User Behavior Evaluation of an Intelligent Shared Electric Vehicle System,” Transportation Research Record 1760, pp 145-152. Washington, DC: Transportation Research Board. Barth, Matthew; Todd, Michael; and Xue, Lei (2004). “User-Based Vehicle Relocation Techniques for Multiple-Station Shared-Use Vehicle Systems.” Paper presented at Transportation Research Board 83rd Annual Meeting, Washington, DC, January 11-15, 2004. Bergmaier, R., Mason, C., McKenzie, M., Campbell, S., and Hobson, A., (2004). Car Sharing: An Overview. Australian Government, Canberra. Bernard, Martin (2003), A Ten-Year Retrospective on the National Station Car Association. Oakland, CA: National Station Car Association. Britton, Eric (1999a). “Carsharing? A roadmap & compass for this long trip,” World Transport Policy & Practice, 5(3): 1-8.

Page 2-33 Car-Sharing: Where and How It Succeeds Britton, Eric (1999b). “A Short History of Early Car Sharing Innovations,” World Transport Policy & Practice, 5(3): 9-15. Brook, David (2004). Carsharing – Start Up Issues and New Operational Models. Paper presented at Transportation Research Board 83rd Annual Meeting, Washington, DC, January 11-15, 2004. Cambridge Systematics (1986), Evaluation of the Short-Term Auto Rental (STAR) Service in San Francisco, CA. Report submitted to Urban Mass Transportation Administration, US Department of Transportation. Cervero, Robert and Tsai, Yu-Hsin (2003), San Francisco City CarShare: Travel Demand Trends and Second-Year Impacts. University of California at Berkeley, Institute of Urban and Regional Development. Working Paper 2003-05. City CarShare (2005). Bringing Car-Sharing to Your Community. San Francisco: City CarShare. www.citycarshare.org/download/CCS_BCCtYC_Long.pdf. City of Toronto (2000). Planning and Transportation Committee, Staff Report, August 17, 2000. Cousins, Steven (1999). “Theory, Benchmarking, Barriers to Carsharing: An Alternative Vision & History,” World Transport Policy & Practice, 5(3): 44-52. DeMaio, Paul and Gifford, Jonathan (2004). “Will Smart Bikes Succeed as Public Transportation in the United States?” Journal of Public Transportation 7(2): 1-15. Doherty, M.J., Sparrow, F.T. and Sinha, K.C. (1987). “Public Use of Autos: Mobility Enterprise Project,” Journal of Transportation Engineering 113(1): 84-94. Harms, Sylvia and Truffer, Bernard (1998). The Emergence of a Nationwide Carsharing Co-operative in Switzerland. Prepared for EAWAG – Eidg. Anstalt für Wasserversorgung. Abwasserreinigung und Gewasserschutz. Switzer- land. Katzev, Richard (2003). “Car Sharing: A New Approach to Urban Trans- portation Problems,” Analysis of Social Issues and Public Policy 3(1). www. asap-spssi.org. Mastretta, Marco (2005). ICS: the Italian Car Sharing National Circuit. Pre- sentation at Keys to Car-Sharing: Moving the City of Tomorrow, Brussels, 27-28 January 2005.

Chapter 2 • State of the praCtiCe September 2005 Page 2-34 Meaton, J; Starkey, R; Williams, S (2003). “Stelios: the Accidental Environ- mentalist? The Potential Impacts of the EasyCar Club in the UK,” World Transport Policy & Practice 9(1): 31-36. MOSES (2004). Design and Building of Demonstrators. Deliverable 3.2: Tech- nological Demonstrators and Service Modules. Nakayama, Shoichiro; Yamamoto, Toshiyuki; and Kitamura, Ryuichi (2002), “Simulation Analysis for the Management of an Electric Vehicle-Sharing System”, Transportation Research Record 1791, pp 99-104. Washington, DC: Transportation Research Board. Reutter, Oscar and Böhler, Susanne (2000). “Car Sharing for Business: The Aachen Region Pilot Project.” World Transport Policy & Practice, 6(3): 11-17. Robert, Benoît (2000). Potentiel de l’auto-partage dans le cadre d’une politique de gestion de la demande en transport. Paper presented at Forum de l’AQTR, gaz à effet de serre: transport et développement, Kyoto: une opportunité d’affaires?, Montréal, February 7, 2000. Rydén, Christian and Morin, Emma (2004). Legal, Political and Fiscal Incentives and Barriers for Car-Sharing. Horizontal Issues Report WP 6. Accessed February 1, 2005 at http://213.170.188.3/moses/Downloads/reports/wp6_report.pdf. Schwartz, Joachim (2005). Quality in CarSharing. Presentation at Keys to Car- Sharing: Moving the City of Tomorrow, Brussels, 27-28 January 2005. Schwieger, Bodo (2004). International Developments towards Improved Car- Sharing Services. Oxford: Writersworld. Schwieger, Bodo and Wagner, Conrad (2003). Second Generation Car-Shar- ing. Presentation at the 10th World Congress and Exhibition on Intelligent Transport Systems and Services, Madrid, 16-20 November 2003. Shaheen, Susan; Meyn, Mollyanne; and Wipyewski, Kamill (2003). “U.S. Shared-Use Vehicle Survey Findings: Opportunities and Obstacles for Car- Sharing and Station Car Growth,” Transportation Research Record 1841, pp 90-98. Washington, DC: Transportation Research Board. Shaheen, Susan; Schwartz, Andrew; and Wipyewski, Kamill (2004). “Policy Considerations for Carsharing and Station Cars: Monitoring Growth, Trends and Overall Impacts,” Transportation Research Record 1887, pp 128-136. Wash- ington, DC: Transportation Research Board.

Page 2-35 Car-Sharing: Where and How It Succeeds Shaheen, Susan, Sperling, D. and Wagner, Conrad (1998). “Carsharing in Europe and North America: Past, Present and Future,” Transportation Quar- terly, 52(3):35-52. Shaheen, Susan; Wipyewski, Kamill; Rodier, Caroline; Novick, Linda; Meyn, Molly Anne; and Wright, John (2004). Carlink II: A Commuter Carsharing Pilot Program. Final Report. California PATH Research Report UCB-ITS-PRR-2004- 23. Traue, Roy (2001). MOSES State-of-the-Art Report. Cambio Stadtauto. Ac- cessed March 29, 2004 at http://213.170.188.3/moses/m_papers/StateOfT- heArtReportFINAL.pdf. Vägverket (2003). Make Space for Car-Sharing! Publ. No. 2003:88E. July 2003. Accessed March 29, 2004 at www.vv.se/publ_blank/bokhylla/miljo/2003_ 88/. Wagner, Conrad (2005). Car-Sharing Product Lifecycle. Presentation at Keys to Car-Sharing: Moving the City of Tomorrow, Brussels, 27-28 January 2005.

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TRB’s Transit Cooperative Research Program (TCRP) Report 108: Car-Sharing--Where and How It Succeeds examines development and implementation of car-sharing services. Issues addressed in the report include the roles of car-sharing in enhancing mobility as part of the transportation system; the characteristics of car-sharing members and neighborhoods where car-sharing has been established; and the environmental, economic, and social impacts of car-sharing. The report also focuses on car-sharing promotional efforts, barriers to car-sharing and ways to mitigate these barriers, and procurement methods and evaluation techniques for achieving car-sharing goals.

Appendices A through E of TCRP Report 108 are included with the report on CRP-CD-60 that is packaged with the report. The appendices include an annotated bibliography; a list of partner organizations surveyed and interviewed; survey instruments; and sample documents such as Requests for Proposals (RFPs) and zoning ordinances related to car-sharing. Appendix E was designed as a resource for introducing organizations to car-sharing and encouraging partnerships to initiate car-sharing programs.

Links to the download site for the CRP-CD-60 and to instructions on burning an .ISO CD-ROM are below.

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