In conversation with Jochem Beunderman, Public Affairs Manager- DOET, we tried to understand the Car Sharing space in Netherlands market. We also discussed about the rising demand of electric mobility in the car sharing space.
“Car Sharing market is moving towards electric mobility and is emerging as a great alternative to car ownership in Netherlands”
Q1) Could you share your insights about the car sharing industry in Netherlands?
Car sharing industry in Netherland is currently in its growth stage and a lot many players have entered this sector in the past few years. In 2020, around 730,000 were making use of shared cars. There is a trend observed in the market that people are gradually opting for car sharing instead of other options like car ownership due to increasing costs of owning a car. Growing attention for the environment and the fight against congestion on the roads are also reasons contributing to its popularity.
Q2) What are the reasons and growth drivers behind the spike in the demand for car sharing market?
One of the major reasons behind the spike in car sharing is the high costs of ownership of vehicles. The car prices have doubled post pandemic due to supply side shortages. Another reason is difficulty in getting parking permits in Netherlands due to a space crunch. Shifting to car sharing implies lesser number of cars in metropolis areas and hence lowering the parking hassle. As previously mentioned, growing attention for the environment and the fight against congestion on the roads are additional factors positively impacting the car sharing space.
Q3) Who are the major players in the Car Sharing industry in Netherlands?
Even though there are a number of small local players operating throughout Netherland, there are a few top players in this industry. The major players currently include My wheels with a fleet size of 2500, Green wheels with a fleet size of 1400, Green Mobility, Snap car, SIXT Share and Share Now. As the nature of the market is moderately fragmented, the above list of players is not exhaustive.
Q4) Who are the major end users of the car sharing market?
Generally, car sharing is opted by people between the ages 18-35 or the young people due to affordability issues. Car sharing is a way more cost-effective option for the youth and a convenient method too. It prevents the costs of ownership and maintenance. Car sharing is also perfect for people who travel less often by car and drive shorter distances. It is a more sustainable and environment friendly option.
Q5) What are the different types of operating models existing in the Car sharing space?
There are various operating models in car sharing space. B2C model or business to customer in which the fleet belongs to the business entities. B2C model is undertaken by My wheels, Green Wheels, SIXT Share. P2P model or peer to peer where the fleet belongs to the customers itself but the business entity acts as a platform where different customers can enter into transaction. This model is undertaken by Snap car. Free floating model is a model in which a customer can pick up the shared car at any location and drop off the car at some other location. The pick up and the drop off point need not be the same.
Q6) Which are the popular regions in Netherlands where car sharing is most demanded?
The central region or the metropolis area of Amsterdam, Rotterdam, Utrecht and Hague demand the greatest number of shared cars. Amsterdam alone had about 11,000 shared cars which are often electric. Utrecht and The Hague each have more than 5,000 shared cars. The city centers in Netherland are the major areas demanding car sharing. In future, it is expected that the Southern region would gain share as it is a densely populated region.
Q7) How did the pandemic affect the car rental industry?
Pandemic had a major impact on the car rental industry as it had on almost all other sectors in the economy. Due to huge number of losses and fall in demand, a large number of car rental companies sold off a major proportion of their fleet. Due to shortage of cars available, the prices of vehicles provided by the car rental companies almost doubled. On a positive note, people shifted to online mode of booking as compared to offline booking. The other positive side to pandemic was that it conveyed the idea and benefits of a smaller number of cars on road leading to less emissions and traffic.
Q8) What are the future trends that can be seen in the Car sharing industry?
Car sharing industry is witnessing huge growth and is expected to expand throughout Netherlands in the future. Electric vehicles will occupy the major share in the vehicles operating in this market. This is because there are a number of advantages provided to EVs as compared to internal combustion engine vehicles like parking permits and less taxes charged. If the government tries to make car ownership a less attractive option, car sharing industry can benefit from such a move.
Q9) What is your future outlook for car sharing and electric mobility in Netherlands?
Netherland market is aiming to shift to zero emissions and moving towards electric mobility. As car sharing is a great alternative to owning cars and is an environment and pocket friendly option, we can see an upward trend in the demand for shared cars in Netherland. Moreover, it is expected to witness a rise in small cars in the car sharing space and in terms of the operating model, free floating model will rise in the future. Most of the shared cars would be electric in nature.
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