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Zipcar Launches in Taiwan Prior to Wider Expansion Across SE Asia

Following its successes throughout North America and Europe, the popular car-sharing service tests the water in Taipei as it looks to bring its high-tech approach to congestion-busting to a number of other major cities across Asia.

Photo: Taiwan: The Asian test-bed for the high-tech car-sharing concept that has already wowed North America. (Shutterstock.com/DavidNNP)
Taiwan: The Asian test-bed for the high-tech car-sharing concept that has already wowed North America.
Photo: Taiwan: The Asian test-bed for the high-tech car-sharing concept that has already wowed North America. (Shutterstock.com/DavidNNP)
Taiwan: The Asian test-bed for the high-tech car-sharing concept that has already wowed North America.

Zipcar, the popular car-sharing service, made its Asian debut in June this year when the company, a subsidiary of the New Jersey-headquartered Avis Budget Group, opened for business in Taipei. It is believed Taiwan was chosen as the test-bed for the company's wider roll-out across Asia given its relative lack of competition compared with a number of other territories, notably mainland China, and the general willingness of local consumers to try out new ideas.

The Zipcar concept began life in Massachusetts back in 2000, with the company differing from standard car-hire firms in a number of key ways. Firstly, would-be users have to sign up as a member, with fees starting as low as US$7 a month, while separate options are available for business users and those likely to use the service on a more frequent basis. Driving fees are then, on average, between $8-10 an hour, depending on the exact location and model of the car.

Once approved, a member can then check the local availability of vehicles via the Zipcar app or website. Cars can then be reserved for any given period via the same app, which also allows for the pick-up point to be specified and any extension to the lease period to be arranged. Usually, the car then has to be returned to the original pick-up point on a round-trip basis, although, in certain US cities including Los Angeles and Washington DC, one-way trips are bookable with the vehicle simply left at an agreed location within the destination city.

Following its initial success in the US, the company made its first bid for international expansion in 2006 when it began operating in Canada. Five years later, in April 2011, it listed on the NASDAQ, the second-largest stock exchange in the US.

Its success saw it attract the attention of Avis, and the $500 million acquisition of Zipcar was completed in March 2013. By September 2016, it was firmly established as the world's largest car-sharing network, with more than one million members and operations in 500 cities across North America and Europe.

In terms of its Asian aspirations, the company was initially deterred by the strengths of existing operations on the Chinese mainland. For an extended period of time, three operators – Didi, Kuaidi and Uber China – were engaged in a pitched battle for dominance of the sector, one that only really ended when Didi Chuxing took over Uber China in August last year.

Compared with the intense competition on the mainland, Taiwan was seen as offering a far less bruising entrance into the wider Asian market. The practice of bike-sharing, which has much in common with the Zipcar concept, was already well-established in the territory, with the total number of trips on YouBike, the market leader in the sector, exceeding 100 million by August 2016.

As well as its pre-existing sharing culture, Taiwan's shortage of car-parking spaces, coupled with the cautious approach being taken by the car-sharing businesses already operating in the territory, all added to its appeal for Zipcar. In the case of Uber, the company had got off to something of a false start in Taiwan, having been obliged to quit the market in February 2017 due to problems with both its operating licence and its compliance with the territory's tax regime. Although it resumed operations two months later, its credibility had already been somewhat damaged.

The territory, therefore, was ripe for Zipcar's arrival. Speaking at the company's formal launch in Taipei, Massimo Marsili, the President of the company's operations in Europe, the Middle East and Asia, said: "Today marks a great milestone for Zipcar. Not only are we extending our operations into another world-class city, while helping to tackle congestion, it is also our first launch into the Asia-Pacific region. With that in mind, we particularly look forward to welcoming our new Taiwanese members to our wider network."

Photo: YouBike: A precursor of the Zipcar approach. (Shutterstock.com/asiastock)
YouBike: A precursor of the Zipcar approach.
Photo: YouBike: A precursor of the Zipcar approach. (Shutterstock.com/asiastock)
YouBike: A precursor of the Zipcar approach.
Photo: Zipcar: A logo soon to be familiar in many Asian cities. (Shutterstock.com/Joshua Rainey Photography)
Zipcar: A logo soon to be familiar in many Asian cities.
Photo: Zipcar: A logo soon to be familiar in many Asian cities. (Shutterstock.com/Joshua Rainey Photography)
Zipcar: A logo soon to be familiar in many Asian cities.

At present, Zipcar has some 30 car-sharing stations in the Greater Taipei area, mainly in and around the city centre and close to a number of university campuses. Members have also been promised access to a wide range of vehicles, including the Volkswagen Golf and the Audi A1, both of which are said to be ideal for shopping or seeing family and friends.

A number of small vans, such as the Volkswagen Caddy, will also be available and can be used for moving house or for other instances when more space is required. At the top of the range is the Volkswagen Sharan, said to be the ideal vehicle for transporting larger groups.

Robert Kang, Special Correspondent, Taipei

Content provided by Picture: HKTDC Research
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