BMW Moves Into Zipcar’s Territory

Car-sharing program boosts brand

To win over trendy young drivers, BMW is launching a new on-street car-sharing service this month in San Francisco. Drivers will be able to rent BMW electric cars that are parked on city streets and return them to several drop-off points in the Bay Area, including major airports.

The service is an extension of BMW’s two-year-old DriveNow program, which rents BMW ActiveE electric cars at 17 stations in San Francisco, Silicon Valley and the East Bay.

“Having groups of our cars parked on well-traveled streets is more convenient for drivers and it’s also an effective way to increase the visibility of the BMW brand and our electric cars, said Dana Goldin, CMO of DriveNow. 

DriveNow members pay a one-time $39 fee and then, like Zipcar and other car-sharing companies, they pay a fee for the time they use the car. Unlike Zipcar, members can return the car at any of the program’s parking spots or stations. Members use the DriveNow app and website to locate and reserve cars and find approved parking spaces. 

As part of the launch, 80 new electric cars will be added to the DriveNow fleet, bringing the total to 150. DriveNow members are invited to name the vehicles in a two-week Twitter and Facebook contest.

Neighborhood car-sharing is a smart move for BMW, said Toby Southgate, CEO at Brand Union, a branding consultancy. “It strengthens BMW’s reputation as an innovator prepared to take risks and explore new forms of mobility, he said.

But could programs like this reinforce sharing instead of buying cars among young consumers? Southgate maintains they are separate markets.

About 87 percent of millennials said their car is a significant part of their life, per a recent MRY survey.  But “car-sharing isn’t going away, it’s a new category for drivers who don’t want or can’t justify full-time ownership,” Southgate said. “This initiative taps into that different need state.
Daimler AG offers a similar one-way car-sharing service called Car2Go, which rents electric and gas Smart cars in San Diego; Seattle; Portland, Oregon; and Austin, Texas. Ford, Toyota and a few other carmakers partner with existing car-sharing companies in the U.S.