Rental car-sharing business burgeoning amid difficulties

Updated 2017-08-31 10:01:55 Global Times
Shared vehicles of Gofun are parked in one designated parking space under the Guomao Bridge, Beijing in March. (Photo/Courtesy of Gofun)

Shared vehicles of Gofun are parked in one designated parking space under the Guomao Bridge, Beijing in March. (Photo/Courtesy of Gofun)

With a boom in shared economy supported by national policy, rental car-sharing business has rapidly emerged as a part of the public transport system in Chinese cities in the last two years. But, while demand is rising, firms engaged in the rental operation are also facing an array of bottlenecks such as high operational costs and limited parking or charging facilities. Experts suggest firms should adopt a collaborative strategy to survive and thrive in the sector, which is projected to be a future trend featuring self-driving technology.

Sitting in a rented white Peugeot car, Jia Rui, a Beijing resident who often keeps a busy schedule of business meetings, is paying the usage fees on a car-rental app through his mobile phone. Different from traditional car rental services, this vehicle belongs to short-term rental service, known as car-sharing.

Much like shared bikes, users can directly scan QR (quick response) codes to unlock a car or book it in advance, then park it when the trip is completed and end the charging, which is usually based on mileage plus time of usage.

There are currently two ways to find shared cars for renting - station-based cars parked on designated spots and the free floating ones.

For the specific order Jia showed the Global Times, it cost him a total of 50 yuan (.57) for a 93-minute trip of 9.4 kilometers.

Having participated in Beijing's vehicle lottery for more than three years, Jia is yet to become a lucky winner to get the car license plate.

In Beijing, the State-run lottery system refreshed its record in the latest round, with 854 people scrambling for one car plate, according to local media reports.

"The car-sharing model has really brought convenience to my working life although there are still some problems such as the long distance to find a car, high parking fees despite the partial refund by the platform and untidy environment inside the car," Jia noted.

Gaining speed

At present, there are about 100 companies nationwide engaged in operating the rental car-sharing business, Shu Liang, an industry watcher and managing partner at Shanghai-based Estar Capital, told the Global Times on Monday.

"Having developed slowly since 2011, car-sharing model leaped into the public spotlight in the past two years in China thanks to a boom in the shared economy, especially bike-sharing, which has had an obvious influence on popularizing car-sharing," Shu said.

New-energy vehicles (NEVs) take the lion's share of the shared cars, with about 6,000 electric vehicles operated by 37 car-sharing companies currently in Beijing, Shanghai, and Guangzhou, capital of South China's Guangdong Province, according to statistics from Beijing-based research consultancy Analysys.

The number of active users in the car-sharing business reached over 2 million across the country in June, up 10.53 percent from previous month, data from Analysys showed.

After a six-year exploration, the car-sharing segment has also won policy support, with the Ministry of Transport and the Ministry of Housing and Urban-Rural Development jointly releasing the guideline on the sound development of shared cars on August 8.

The policy confirms the active role the car-sharing model is going to play in reducing the desire for car ownership which requires large resources of road and parking space, as well as alleviating traffic congestion in cities.

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