Daimler’s Car2go coming to Brooklyn

Madeline O’Leary
Bloomberg News

Car2go, the Daimler AG unit that rents tiny Smart cars by the minute, is coming to Brooklyn, underscoring the push to tap into the population of urban drivers who don’t own vehicles.

The company will offer a fleet of 400 two-person Smart cars for short-term rentals. Customers in the fast-growing borough won’t be restricted to specific lots: They can pick up or leave a car at any legal spot in a 36 square-mile area that includes Williamsburg, Park Slope and Coney Island, the company said.

This “allows members the flexibility to move throughout their city completely at their convenience,” Paul DeLong, chief marketing officer for North America, said in a statement. “Getting where you need to go, when you need to go is fundamental.”

The company will join Avis Budget Group Inc.’s Zipcar and Hertz Global Holdings Inc.’s Hertz 24/7 in Brooklyn, where it’s waiving its $35 registration fee and offering 30 minutes of drive time. Along with taxi alternatives, such as Uber and Lyft, these companies are making it easier for urbanites to avoid car ownership.

“Younger generations don’t want the hassle of car ownership, and the cost of cars is a significant investment,” said Rick Hanna, global and U.S. automotive leader for consultant PricewaterhouseCoopers LLP. “Five years ago, you only had public transportation and taxis. Now, with car-sharing models, you can pick up transportation by the hour and by the day.”

Members can find cars through an app or on the street and use them for 41 cents per minute, including insurance, maintenance and fuel costs. Per hour and per day rates are $14.99 and $84.99, respectively. With more than 850,000 registered members, car2go operates in cities seven countries, including cities such as Montreal, Miami and Berlin.

Researcher IBISWorld estimates the current market for car- sharing to be about $730 million, or 2 percent of the $36.4 billion U.S. rental and leasing industry. The market for car- sharing is poised to double over the next five years, IBISWorld said. The car-sharing segment has grown by about 30 percent per year for the past five years, outpacing the broader industry, which has grown at 3.1 percent for the past five years, the researcher said.