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The community kitchen in Rotherhithe has been delivering hundreds of cooked meals each week for the past two years to pensioners and needy locals in south London. However, their operations have been thrown into disarray by the news that they will lose cars and vans on New Year’s Day.

This organization had relied on Zipcar, the car-sharing company that allowed its cars via smartphone. It sent shockwaves across London when it said it would shut down its UK business from 1 January.

It will mean many helpers cannot pick up supplies from the Felix Project, that collects surplus food from supermarkets, cafes and restaurants. Other options are less convenient, more expensive, or do not offer the same convenient access.

“It’s going to be affected massively,” said Vimal Pandya, the project's founder. “My team and I are worried about the operational hurdle we will face. Many groups like ours are going to struggle.”

“Knowing the reality, everyone is concerned and thinking: ‘How will we continue?’”

A Major Blow 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 easy use to vehicles, without the hassle and cost of ownership. Most of those people were likely with Zipcar, which held a dominant position in the city.

This shutdown, pending consultation with staff, is a serious setback to hopes that car sharing in cities could cut the need for owning a car. Yet, 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 green advocates as a way of mitigating the ills linked to vehicle ownership. Most cars sit as two-tonne dead weights on the side of the road for the vast majority of the time, occupying parking. They also require large CO2 output to produce, and people without a vehicle tend to walk, cycle and take transit more. That benefits cities – easing congestion and pollution – and improves people’s health through increased activity.

Understanding the Decline

Zipcar was founded in 2000 before being bought by the US car rental group Avis Budget in 2013. Zipcar’s UK revenues barely registered compared with its owner's total earnings, and a deficit that grew to £11.7m in 2024 gave little incentive to continue.

Avis Budget has said the closure is part of a “wider restructuring across our global operations, where we are taking targeted actions to streamline operations, enhance profitability”.

Zipcar’s most recent accounts noted revenues had fallen as drivers took less frequent, shorter trips. “This trend reflect the ongoing impact of the economic squeeze, which is dampening demand for non-essential services,” it said.

London's Unique Challenges

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

• Patchwork Policies: Across 33 boroughs, car-club operators face a patchwork of different procedures and costs that made it harder.
• New Costs: The closure coincides with electric cars start paying London’s congestion charge, adding unavoidable costs.
• Unequal Parking Fees: Residents in some boroughs pay as little as £63 for a year’s electric car parking permit. A similar shared vehicle would pay over £1,100 per year, creating a major disincentive.

“We should literally be charged one-twentieth of a resident’s permit,” argued Robert Schopen of Co Wheels. “We’re taking cars off the street. We introduce cleaner models in their place.”

A European Example

Other European countries offer models for London to follow. Germany introduced national shared mobility laws in 2017, providing a nationwide framework for parking, subsidies 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.

“The evidence shows is that car sharing around the world, particularly on the continent, is expanding,” commented 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 already seriously considering entering the London market: “There will be fill this gap.”

The Future Landscape

Other players can be split into two camps:

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 hire out their own vehicles via an app – similar to Airbnb for cars. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

Turo, a US-headquartered P2P service, is assessing the UK gap. Rory Brimmer, its UK managing director, said there was a “significant chance” to win more users. “A space exists that is going to need to be filled, because London still needs to move,” Brimmer said.

Yet, it could take a while for other players to build momentum. In the meantime, more people may feel forced to buy cars, and others across London will be without a convenient option.

For the volunteers in Rotherhithe, the coming weeks will be a scramble to find a solution. The delivery problem caused by Zipcar’s exit highlights the wider implications of its departure on community groups and the prospects of car-sharing in the UK.