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A community kitchen in Rotherhithe has been delivering hundreds of cooked meals each week for two years to elderly residents and vulnerable locals in southeast London. Yet, the group's plans face major disruption by the announcement that they will not have use of New Year’s Day.

This organization had relied on Zipcar, the car-sharing company that customers to access its fleet of vehicles via smartphone. It sent shockwaves through the capital when it said it would cease its UK business from 1 January.

This means many helpers will be unable to collect food from the Felix Project, that collects surplus food from supermarkets, cafes and restaurants. Obvious alternatives are further away, costlier, or lack the same flexible hours.

“The impact will be massively,” said Vimal Pandya, the community kitchen’s founder. “Personally me and my team are worried about the logistical challenge we will face. Many groups like ours are going to struggle.”

“Faced with this reality, they are all worried and thinking: ‘How are we going to carry on?”

A Significant Setback for Urban Car-Sharing

The community kitchen’s drivers are part of over 500,000 people in London who were car club members, who could be left without easy use to vehicles, without the hassle and cost of ownership. The vast majority of those people were probably with Zipcar, which had a near-monopoly position in the city.

The planned closure, pending consultation with staff, is a big blow to the vision that car sharing in urban areas could cut the need for private vehicle ownership. However, some analysts have noted that Zipcar’s exit need not mean the demise for the idea in Britain.

The Promise of Shared Mobility

Car sharing is prized by many urbanists and green advocates as a way of mitigating the ills associated with vehicle ownership. Most cars sit idle on the side of the road for the vast majority of the time, using up space. They also require large carbon emissions to produce, and people who do not own cars tend to walk, cycle and take transit more. That helps urban areas – easing congestion and pollution – and improves people’s health through increased activity.

What Went Wrong?

Zipcar was founded in 2000 before its acquisition by the US car rental group Avis Budget in 2013. Zipcar’s UK revenues were minimal compared with its parent company's total earnings, and a loss that grew to £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, enhance profitability”.

Zipcar’s most recent accounts noted revenues had fallen as drivers took less frequent, shorter trips. “These changes reflect the continuing effect of the economic squeeze, which continues to suppress demand for non-essential services,” it said.

London's Unique Hurdles

However, industry observers noted that London has particular issues that made it difficult for the company and its rivals to succeed.

• Patchwork Policies: With numerous local councils, car-club operators face a mosaic of different procedures and prices that complicate operations.
• Congestion Charge: The closure comes as electric cars start paying London’s congestion charge, adding extra expenses.
• Parking Permit Disparity: Residents in some boroughs pay just £63 for a year’s electric car parking permit. A floating car club would pay over £1,100 per year, creating a major disincentive.

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

Lessons from Abroad

Other European countries offer models for London to follow. Germany enacted national car-sharing legislation in 2017, providing a nationwide framework for parking, subsidies 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.

“What we see is that car sharing around the world, particularly on the continent, is growing,” said Bharath Devanathan of Invers.

He suggested authorities should start to treat car sharing as a form of public transport, and integrate it with train and bus stations. He added that one unnamed client was looking at entering the London market: “There will be fill this gap.”

What Comes Next?

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

1. Fleet Operators: 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 rent out their own vehicles via an app – similar to Airbnb for cars. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

One company, a US-headquartered P2P service, is already weighing up the UK gap. Rory Brimmer, its UK managing director, said there was a “significant chance” to win more users. “A space exists that is going to need to be filled, because London still needs to move,” Brimmer said.

However, it could take some time for other players to build momentum. In the meantime, more people may feel forced to buy cars, and others across London will be left without access.

For the volunteers in Rotherhithe, the next month will be a scramble to find a solution. The delivery problem caused by Zipcar’s exit highlights the wider implications of its departure on vital services and the prospects of car-sharing in the UK.