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A volunteer food project in Rotherhithe has provided hundreds of cooked meals each week for two years to pensioners and vulnerable locals in southeast London. Yet, their operations have been thrown into disarray by the news that they will lose use of New Year’s Day.

This organization had relied on Zipcar, the app-based vehicle rental service that customers to access its fleet of vehicles via smartphone. The company sent shockwaves through the capital when it declared it would shut down its UK business from 1 January.

This means many volunteers cannot pick up supplies from a major food charity, which gathers surplus food from supermarkets, cafes and restaurants. Obvious alternatives are further away, costlier, or lack the same convenient access.

“It’s going to be affected massively,” said Vimal Pandya, the project's founder. “Personally me and my team are worried about the logistical challenge we will face. Many groups like ours will face difficulties.”

“Knowing the reality, everyone is concerned and thinking: ‘How are we going to carry on?”

A Major Blow for Urban Car-Sharing

The community kitchen’s drivers are among more than half a million people in London who were car club members, now potentially left without convenient access to vehicles, avoiding the burden and cost of ownership. The vast majority of those members were likely with Zipcar, which held a dominant position in the city.

The planned closure, subject to consultation with staff, is a big blow to hopes that vehicle clubs in urban areas could cut the need for owning a car. However, some analysts also suggested that Zipcar’s exit need not spell the end for the concept in Britain.

The Potential of Car Sharing

Shared vehicle use is prized by many urbanists and green advocates as a way of reducing the ills linked to vehicle ownership. Most cars sit as two-tonne dead weights on the side of the road for the vast majority of the time, occupying parking. They also involve large carbon emissions to produce, and people who do not own cars tend to use active travel and take transit more. That benefits cities – reducing congestion and pollution – and boosts public health through increased activity.

What Went Wrong?

The company started in 2000 before its acquisition by the US car rental group Avis Budget in 2013. Zipcar’s UK income were minimal compared with its owner's total earnings, and a loss that grew to £11.7m in 2024 gave no reason to continue.

The parent company stated the closure is part of a “broader transformation across our global operations, where we are taking deliberate steps to streamline operations, enhance profitability”.

Zipcar’s most recent accounts said revenues had fallen as drivers took fewer and shorter trips. “These changes reflect the ongoing impact of the economic squeeze, which is dampening demand for non-essential services,” it said.

The Capital's Specific Challenges

However, industry observers noted that London has specific problems that made it difficult for the sector to succeed.

• Patchwork Policies: With numerous local councils, car-club operators face a patchwork of different procedures and costs that complicate operations.
• Congestion Charge: The closure comes as electric cars becoming liable for London’s congestion charge, adding unavoidable costs.
• Parking Permit Disparity: Residents in some boroughs pay as little as £63 for a year’s electric car parking permit. A floating car club would pay over £1,100 annually, creating a significant barrier.

“We should literally be charged one-twentieth of a private parking cost,” argued Robert Schopen of Co Wheels. “We remove vehicles. We’re putting less polluting cars in their place.”

Lessons from Abroad

Nations in Europe offer examples for London to follow. Germany introduced national car-sharing legislation in 2017, providing a unified system for parking, support and waivers. Now, the country has 5.4 shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK trails at 0.7.

“The evidence shows is that car sharing around the world, especially in Europe, is expanding,” said Bharath Devanathan of Invers.

Devanathan said authorities should start to view vehicle clubs as a form of mass transit, and link it with train and bus stations. He added that a potential operator was already seriously considering entering the London market: “There will be fill this gap.”

What Comes Next?

The company’s competitors can be split into two models:

1. Fleet Operators: Which own or lease their own cars. Examples Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Person-to-Person Rentals: Which allow users to rent out their own vehicles via an app – a kind of Airbnb for cars. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

One company, a US-headquartered peer-to-peer platform, is assessing the UK gap. Rory Brimmer, its UK head, said there was a “big opportunity” to win more users. “A space exists that is going to need to be filled, because London still needs to move,” Brimmer said.

Yet, it could take some time for other players to build momentum. In the meantime, more people may choose to buy cars, and many across London will be without a convenient option.

For the volunteers in Rotherhithe, the coming weeks will be a scramble to find a solution. The logistical challenge caused by Zipcar’s exit underscores the broader impact of its departure on vital services and the prospects of shared mobility in the UK.