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A volunteer food project in Rotherhithe has been delivering hundreds of prepared dishes each week for the past two years to pensioners and needy locals in southeast London. Yet, their operations face major disruption by the announcement that they will not have access to New Year’s Day.

The group depended on Zipcar, the app-based vehicle rental service that allowed its cars via smartphone. It caused shock through the capital when it said it would shut down its UK operations from 1 January.

This means many volunteers cannot pick up supplies from the Felix Project, which gathers excess produce from supermarkets, cafes and restaurants. Obvious alternatives are less convenient, more expensive, or lack the same convenient access.

“The impact will be massively,” said Vimal Pandya, the community kitchen’s founder. “My team and I are concerned by the logistical challenge we will face. A lot of people like ours are going to struggle.”

“Faced with this reality, everyone is concerned and thinking: ‘How are we going to carry on?”

A Major Blow for City Vehicle Clubs

These volunteers are part of more than half a million people in London who were car club members, who could be left without convenient access to vehicles, without the hassle and cost of ownership. Most of those members were probably with Zipcar, which had a near-monopoly position in the city.

This shutdown, pending consultation with employees, is a big blow to the vision that vehicle clubs in urban areas could reduce the need for private vehicle ownership. Yet, some experts have noted 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 mitigating the ills linked to vehicle ownership. Most cars sit idle on the street for the vast majority of the time, occupying parking. They also involve large carbon emissions to produce, and people without a vehicle tend to walk, cycle and take transit more. That helps urban areas – easing congestion and pollution – and improves public health through more exercise.

What Went Wrong?

Zipcar was founded in 2000 before being bought by the US car rental group Avis Budget in 2013. Zipcar’s UK revenues were minimal compared with its parent company's overall annual revenue, and a deficit that reached £11.7m in 2024 gave no reason to continue.

Avis Budget has said the closure is part of a “wider restructuring across our international business, where we are taking targeted actions to simplify processes, improve returns”.

Zipcar’s most recent accounts noted revenues had fallen as drivers took fewer and shorter trips. “These changes reflect the continuing effect of the cost-of-living crisis, which is dampening demand for discretionary spending,” it said.

London's Unique Hurdles

However, several experts noted that London has specific problems that made it difficult for the company and its rivals to succeed.

• Patchwork Policies: With numerous local councils, car-club operators face a patchwork of varying processes and costs that complicate operations.
• Congestion Charge: The closure coincides with electric cars becoming liable for London’s congestion charge, adding extra expenses.
• Unequal Parking Fees: Locals in some boroughs pay just £63 for a year’s electric car parking permit. A floating car club would pay over £1,100 annually, creating a major disincentive.

“We should literally be charged one-twentieth of a private parking cost,” argued Robert Schopen of Co Wheels. “We’re taking cars off the street. We introduce cleaner models in their place.”

A European Example

Nations in Europe offer examples for London to follow. Germany introduced national shared mobility laws in 2017, providing a nationwide framework for parking, support and exemptions. Now, the country has several shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK lags behind at 0.7.

“What we see 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 integrate it with train and bus stations. He added that one unnamed client was looking at entering the London market: “Operators will fill this gap.”

What Comes Next?

The company’s competitors can roughly be divided into two models:

1. Company-Owned Fleets: Which maintain their own cars. This includes Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Peer-to-Peer Services: Which allow users to hire out their own vehicles via an app – a kind of Airbnb for cars. Players include 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 left without access.

For Rotherhithe community kitchen, the next month will be a scramble to find a solution. The delivery problem caused by Zipcar’s exit underscores the broader impact of its departure on community groups and the future of car-sharing in the UK.