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The volunteer food project in Rotherhithe has been delivering a large number of cooked meals each week for two years to elderly residents and vulnerable locals in south London. Yet, the group's plans have been thrown into disarray by the announcement that they will lose use of New Year’s Day.

This organization depended on Zipcar, the car-sharing company that allowed its fleet of vehicles via smartphone. It sent shockwaves through the capital when it said it would shut down its UK operations from 1 January.

This means many helpers will be unable to pick up supplies from the Felix Project, which gathers surplus food from supermarkets, cafes and restaurants. Obvious alternatives are further away, more expensive, or lack the same flexible hours.

“The impact will be massively,” stated Vimal Pandya, the community kitchen’s founder. “Personally me and my team are concerned by the logistical challenge we will face. Many groups like ours will face difficulties.”

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

A Significant Setback for City Vehicle Clubs

The community kitchen’s drivers are among over 500,000 people in London who were car club members, now potentially left without convenient access to vehicles, without the hassle and cost of ownership. Most of those people were probably with Zipcar, which had a near-monopoly position in the city.

This shutdown, pending consultation with employees, is a serious setback to hopes that car sharing in cities could reduce the need for owning a car. However, some experts have noted that Zipcar’s exit need not mean the demise for the idea in Britain.

The Promise of Car Sharing

Car sharing is prized by city planners and environmentalists as a way of mitigating the ills linked to vehicle ownership. Most cars sit idle on the side of the road for 95% of the time, using up space. They also involve large CO2 output to produce, and people who do not own cars tend to use active travel and take public transport more. That helps urban areas – reducing congestion and pollution – and boosts people’s health through more exercise.

Understanding the Decline

Zipcar was founded in 2000 before its acquisition by the American rental giant Avis Budget in 2013. Zipcar’s UK revenues barely registered compared with its owner's overall annual revenue, and a deficit that grew to £11.7m in 2024 gave little incentive to continue.

The parent company stated the closure is part of a “broader transformation across our international business, where we are taking deliberate steps to streamline operations, improve returns”.

Its latest financial reports said revenues had fallen as drivers took fewer and shorter trips. “These changes reflect the continuing effect of the cost-of-living crisis, which continues to suppress demand for non-essential services,” it said.

London's Unique Challenges

Yet, industry observers noted that London has particular issues that made it much harder for the sector to succeed.

• Patchwork Policies: Across 33 boroughs, car-club operators face a patchwork of different procedures and costs that complicate operations.
• New Costs: The closure coincides with electric cars start paying London’s congestion charge, adding extra expenses.
• Unequal Parking Fees: Locals in some boroughs pay as little as £63 for a year’s electric car parking permit. A floating car club would pay over £1,100 per year, creating a significant barrier.

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

Lessons from Abroad

Nations in Europe offer models for London to follow. Germany enacted national shared mobility laws in 2017, providing a nationwide framework for parking, support and exemptions. Now, the country has several 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 shared mobility around the world, especially in Europe, is growing,” said Bharath Devanathan of Invers.

He suggested authorities should start to view vehicle clubs as a form of public transport, and integrate it with train and bus stations. He added that a potential operator was looking at entering the London market: “There will be fill this gap.”

The Future Landscape

Other players can roughly be divided into two models:

1. Fleet Operators: Which maintain their own cars. Examples Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Person-to-Person Rentals: Which allow users to rent out their own vehicles via an app – similar to Airbnb for cars. Players include Britain’s Hiyacar and the US’s Getaround and Turo.

One company, a US-headquartered P2P service, is assessing the UK gap. Rory Brimmer, its UK managing director, said there was a “big opportunity” 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 a while for other players to build momentum. For now, more people may choose to buy cars, and others across London will be without a convenient option.

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