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OCR for page 89
Car-Sharing: Where and How It Succeeds 3.3 Growth Potential While car-sharing is a niche product at present, the potential for growth has excited many researchers. A range of market demand studies, conducted principally in Europe, has estimated a market potential of anything from 3% to 25% of the population. Most of these studies have identified the segments of the population that would use car-sharing often based on survey data and then used this to estimate total market potential. For example: United States. A 2004 study of the market potential in Baltimore, MD suggests that car-sharing could replace at least 4% of private vehicles. This simulation was based purely on cost savings; for more than 4% of vehicles, car-sharing would be cheaper than ve- hicle ownership (Schuster et al., 2005). Austria. The minimum market potential for "pioneer house- holds" was estimated at 13.5% of households in two urban resi- dential neighborhoods in Graz, based on the following criteria (Steininger, Vogl & Zettl, 1996): o Age between 25 and 43 o University degree or equivalent o Own at least one car, but not in a high price bracket o Yearly car mileage of one car below 15,000 km o Share of trips by car less than 33% o Current participation in environmental activities The same study estimated the maximum market potential in the same neighborhoods at a far higher level 69%. This estimate was based on the assumption that the decision to join a car-sharing program would be made solely on rational economic grounds: 69% of households had at least one car driven less than 15,000 km per year and would thus probably realize cost savings from car- sharing. Germany. The potential market demand was estimated at 3% of the population, or approximately 2.45 million people (Baum & Pesch, cited in Shaheen, Sperling & Wagner, 1998). Sweden. The "theoretical potential" was estimated at 25% of households, based on those who could travel to work by non-auto modes, without prolonging their commute time by more than 30 minutes. The "practical potential" was estimated at 5.6%, based on market research surveys asking if a household would be prepared to join a car-sharing organization. Both the "theoretical" and "practical" potential were limited to households possessing the following characteristics: living in communities of at least 10,000 inhabitants; at least one household member between the ages of 18 Page 3-41

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Chapter 3 Market Analysis and 70; and at least one person in the household having a driver's license (Vgverket, 2003). Switzerland. The market potential was estimated at 1.7 mil- lion members, or 23% of the population, based on three criteria (Muheim & Partner, 1998): o Possession of a driver's license o A residence that is not too remote (living in the developed zones of municipalities with at least 2,000 inhabitants) o A journey to work that does not have to be made by car (jour- ney to work would not be lengthened by more than 30 min- utes) In reality, despite impressive growth rates, the actual take-up has fallen far short. Current membership rates are a factor of 12 to 30 times lower than those forecast about a decade ago (Harms, 1998). Mobility Switzerland, for example, had about 60,000 customers in November 2003 (Mobility Swit- zerland, personal communication) 3.5% of the forecast potential. At least partly, this appears to be due to the "routine" nature of car use; as discussed earlier in this chapter, many members appear to join following a "trigger event" such as moving residence or changing jobs. Again, this evidence tends to give further support to the conclusion from the analysis of market typologies. Rather than solely being informed by the characteristics of potential members, market potential studies should focus more on whether neighborhood characteristics will allow car-sharing to be successful. They should also consider whether the institutional characteris- tics are in place, i.e. the depth of support from partner organizations. These issues are explored in the following chapters. Page September 2005 3-42