GM Enters Car-Sharing With Limited Rollout

Gautham Nagesh

The nation’s largest auto maker is placing a bet on a future where more people don’t own their own vehicles.

General Motors Co. launched a car-sharing service on Wednesday that competes with Zipcar, Car2Go and similar companies that target students, city-dwellers and others who don’t own vehicles but would rent one on occasion.

GM President Dan Ammann said while more customers than ever are buying vehicles, there is “an emerging group of customers who want to use cars and mobility in a very different way.” GM’s response is Maven, a service that began operating Wednesday in Ann Arbor, Mich., with plans to expand to an unspecified number of cities later this year. GM didn’t disclose its investment in Maven.

The Detroit auto maker is following Daimler AG’s move into car sharing with Car2Go and signs that fewer young people want to own cars. This week the University of Michigan published a study showing a sharp decline among people under 25 years of age getting their driver’s licenses. Its researchers said young people living in crowded urban areas increasingly choose public transportation, car-hailing services and other options to owning a car.

GM has begun looking at such options, investing $500 million in car-hailing service Lyft Inc. and acquiring assets and employees from Sidecar Technologies Inc.

“We see the emergence of car-share and ride-share in general as much more of an opportunity for GM than it is a threat,” Mr. Ammann said. “It’s already a sizable marketplace and growing quite rapidly.”

Julia Steyn, GM’s vice president for Urban Mobility Programs, said some former Sidecar employees would join the Maven team, which currently has about 40 people. In addition to its car-sharing service, Maven is running experiments in residential car-sharing in New York City, and in peer-to-peer car sharing in Germany.

Maven’s initial foray into the hourly car-rental market may prove challenging. Zipcar struggled to maintain its early customer growth rates and was eventually sold to Avis Budget Group Inc. two years ago at a price below its IPO price. Still, Zipcar executives estimated the car-sharing market in North America, Europe and Asia could eventually reach $10 billion.

The Wall Street Journal