Enterprise buys IGO CarSharing
Enterprise is expanding its carsharing services despite a company executive’s dismissal of the need for a separate carsharing industry.
Wed, May 29, 2013 at 12:59 PM
Enterprise Holdings, which owns Enterprise Rent-A-Car, National Car Rental and Alamo Rent A Car, is expanding its carsharing services with the acquisition of Chicago-based nonprofit IGO CarSharing. The nonprofit organization supports a community of more than 15,000 members and operates more than 200 carsharing locations in 40 Chicago neighborhoods. IGO CarSharing will continue operating in a ‘business as usual’ capacity, but now it is a member of the Enterprise CarShare Network.
Enterprise Holdings is not disclosing the financial terms of the transaction but that isn’t the only aspect of the acquisition that is a bit of a mystery. Why would Enterprise continue to expand its CarShare Network after the company’s head of Corporate Sustainability, Lee Broughton, questioned the benefits of carsharing over traditional rental car services?
In January, Broughton shared his thoughts on the carsharing trend in a post on TriplePundit.com, “Zipcar Sale a Watershed Moment? I Beg to Differ.”
“Don’t get me wrong. Automated car-sharing technology has made certain transportation alternatives available around the clock and even more convenient. But the fact is, local car rental – just like local car sharing – has always offered accessible and affordable mobility options right where people live and work.”
Broughton obviously sees that there is a market for short-term automotive rentals but doesn’t appear to see the need for two different business models. Rental car companies can be carsharing services but carsharing companies aren’t full-scale auto rental companies.
This morning, Leon Kaye shared his insight into the issue, "Services such as IGO are tantalizing to car rental companies who seek to expand their reach. Naturally, many car sharing fans fret over what they view as a corporate takeover of their favorite national and local mobility services. In the long term, they should not worry: if these collaborative consumption services disappear or become a shell of their former selves, new ones will emerge quickly. Car sharing and the rise of the sharing economy overall is here to stay, but is just morphing with the times." Source: Triple Pundit
Collaborative consumption is here to stay and it likely won’t be limited to carsharing services. Andrew Winston, founder of Winston Eco-Strategies, places the future of the sharing economy into the hands of the Millennials, “The barrier it seems to me is more psychological than logistical. Do people want to share their things? We're an acquisitive bunch -- but perhaps the Millennials (and younger) will be much more comfortable with the whole idea.”