This article was about a new emerging concept in the car industry focusing on the renting of cars on very short term periods at hourly and even minute rates. This idea of car-sharing is based off of the tough economic period that we currently live in and is a cheap alternative to purchasing a car, especially in cities or for college students on campuses. The aspects of this new concept that make it so appealing are not only it's cheap rates but also it's ability to reserve and find one of these rented vehicles within 15 minutes of most residences where these car-sharing companies are located. Last year roughly 800,000 people registered to be apart of these car-sharing companies which was a 44% increase from 2011. The idea of simply renting a car when necessary seems to be growing rapidly in the untied states, at least in the metropolitan areas where most of these car companies are located. These companies not only provide a useful and efficient resource to the public but also have started to focus on variety so that customers have a spectrum of choices to choose from when deciding on the make and model of the car they wish to rent.
Another aspect of the car-sharing companies that makes it unique is the new policy adopted by most which lets its customers park anywhere in the city for free, cutting the outside costs to the customer besides the nominal charge fro renting the vehicle itself. This feature allows for a streamlined process where if a customer needed a vehicle quickly he or she could rent the vehicle and only have to worry about getting to their destination and not the minor setbacks of parking or access. One car-sharing company, Car2go, doesn't even require it's customers to indicate how long they will be driving or where there destination is as long as it is returned to the same spot it was acquired from. Overall, I found this article to illustrate an interesting parallel with the marginal cost = marginal benefit equation we have discussed in class and how some companies are taking advantage of the recession we are in to capitalize on people's intentions to save money and maximize their benefits.
hyperlink: http://www.nytimes.com/2013/01/26/business/car-sharing-services-grow-and-expand-options.html?_r=0
I thought this article was really interesting. I didn't even know services like this existed in the United States. I wonder how it is accounted for in GDP?
ReplyDeleteThis is a very interesting idea, and it seems like it will definitely work and has much room for growth in our urban areas. Our struggling economy and job market make this type of business seems like a great idea for right now. The concept of using a car only when you need it, especially with the cost of owning a car being so expensive. It only makes sense that this type of business would develop with urbanization and a struggling economy.
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