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The community kitchen in Rotherhithe has distributed a large number of cooked meals weekly for the past two years to pensioners and needy locals in southeast London. Yet, their operations face major disruption by the news that they will lose use of New Year’s Day.

This organization depended on Zipcar, the app-based vehicle rental service that customers to access its fleet of vehicles via smartphone. The company sent shockwaves through the capital when it said it would cease its UK business from 1 January.

This means many helpers cannot collect food from a major food charity, which gathers excess produce from supermarkets, cafes and restaurants. Obvious alternatives are further away, costlier, or lack the same flexible hours.

“It’s going to be affected massively,” said Vimal Pandya, the project's founder. “Personally me and my team are worried about the logistical challenge we will face. A lot of people like ours are going to struggle.”

“Knowing the reality, everyone is concerned and thinking: ‘How are we going to carry on?”

A Major Blow for City Vehicle Clubs

The community kitchen’s drivers are part of more than half a million people in London registered as car club members, who could be left without convenient access to vehicles, without the hassle and cost of ownership. The vast majority of those people were likely with Zipcar, which had a near-monopoly position in the city.

This shutdown, pending consultation with staff, is a serious setback to the vision that vehicle clubs in urban areas could reduce the need for private vehicle ownership. Yet, some analysts also suggested that Zipcar’s exit need not spell the end for the concept in Britain.

The Promise of Car Sharing

Shared vehicle use is prized by many urbanists and green advocates as a way of mitigating the problems associated with vehicle ownership. Most cars sit idle on the street for the vast majority of the time, using up space. They also require large CO2 output to produce, and people without a vehicle tend to use active travel and take transit more. That benefits cities – reducing congestion and pollution – and improves people’s health through increased activity.

Understanding the Decline

Zipcar was founded in 2000 before being bought by the American rental giant Avis Budget in 2013. Zipcar’s UK revenues were minimal compared with its parent company's total earnings, 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 “wider restructuring across our global operations, where we are taking deliberate steps to streamline operations, improve returns”.

Zipcar’s most recent accounts said revenues had fallen as drivers took fewer and shorter trips. “This trend reflect the continuing effect of the cost-of-living crisis, which is dampening demand for non-essential services,” it said.

The Capital's Specific Hurdles

However, several experts noted that London has specific problems that made it much harder for the company and its rivals to succeed.

• Inconsistent Rules: With numerous local councils, car-club operators face a patchwork of different procedures and prices that made it harder.
• New Costs: The closure coincides with electric cars becoming liable for London’s congestion charge, adding extra expenses.
• Unequal Parking Fees: Residents in some boroughs pay just £63 for a year’s electric car parking permit. A floating car club would pay over £1,100 annually, creating a significant barrier.

“We should literally be charged one-twentieth of a private parking cost,” argued Robert Schopen of Co Wheels. “We remove vehicles. We’re putting less polluting cars in their place.”

Lessons from Abroad

Other European countries offer models for London to follow. Germany introduced national car-sharing legislation in 2017, providing a unified system 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 car sharing around the world, especially in Europe, is expanding,” said Bharath Devanathan of Invers.

He suggested authorities should start to treat car sharing as a form of mass transit, and link it with train and bus stations. He added that one unnamed client was already seriously considering entering the London market: “There will be fill this gap.”

The Future Landscape

The company’s competitors can be split into two camps:

1. Fleet Operators: Which own or lease their own cars. This includes Denmark’s GreenMobility, France’s Free2Move, and Germany’s Miles Mobility.
2. Peer-to-Peer Services: Which allow users to rent out their own vehicles via an app – a kind of Airbnb for cars. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

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

However, it could take some time for other players to build momentum. For now, more people may feel forced to buy cars, and many across London will be left without access.

For the volunteers in Rotherhithe, the next month will be a scramble to find a way. The delivery problem caused by Zipcar’s exit underscores the broader impact of its departure on community groups and the prospects of shared mobility in the UK.