Uber CarShare to close in the coming days, ending a $100m Australian investment

Uber’s plan to revolutionise car ownership in Australia by encouraging owners to rent out their cars when not in use is ending. The company is shutting down its Carshare business, which began in 2022 with the $105 million acquisition of Car Next Door. This move concludes Uber’s significant experiment in Australia, aimed at expanding its car-sharing services globally. Uber declined to comment.

Updates

Below are our rolling updates. You can find much more information in our Facebook Group. If you are already a member, please see our Pinned Post.

2024/09/06 12:00 – Turo announces partnership with Uber to assist with transition and list Turo vehicles on Uber Rent.

2024/08/23 11:30 – Drive Mate announces Q&A session for Monday, 6pm AEST – Facebook Event.

2024/08/22 13:30 – Turo releases Expression of Interest Form for owners migrating from Uber Carshare.

2024/08/22 13:30 – We post our guide for borrowers; I’m an Uber Carshare borrower, where do I go now?

2024/08/22 13:00 – Uber Carshare issues email to car owners advising operations will cease in Australia as of the 12th of September, 2024 and published a Frequently Asked Questions page.

Car Next Door co-founder Will Davies, who joined Uber to lead the car-sharing division, did not respond to requests for comment. While ride-sharing has disrupted the taxi industry in Australia, car sharing has struggled to gain the same traction.

Uber’s car-sharing model, similar to Airbnb for cars, was based on the idea that Australians would rent out their idle vehicles and that more people would forgo car ownership. Car Next Door had attracted various early investors over its 10-year development, including Hyundai, Suncorp, Ampol, and venture capitalist Steve Baxter of Shark Tank fame. Despite this support, the car-sharing model has proven difficult to sustain.

The car-sharing marketplace requires a large number of customers and vehicle owners willing to participate. However, issues such as vehicle damage and poor user experiences have led to high churn rates. Carbar’s CEO, Des Hang, highlighted the challenges of convincing Australians to give up the convenience of vehicle ownership.

Despite Uber’s optimistic expectations, other peer-to-peer car-sharing services like Turo and Drive Mate, as well as car subscription services like Carly, Carbar, and GoGet, have also faced difficulties. Carly’s CEO, Chris Noone, noted that they moved away from peer-to-peer rentals to focus on higher-quality vehicles and better customer service through their conventional rental platform.

Uber appears to be making the same lateral move as the company has recently launched Uber Rent, a new venture which partners with traditional rental brands Thrifty, Budget, and Hertz in Australia and New Zealand, allowing Uber users to hire a car through these established businesses. Uber Rent will be unaffected by the closure of Uber CarShare.

A recent email to car owners using Uber Carshare, dated August 8, mentioned the company strengthening its theft and damage policy, ending its referral program on August 30, and reassuring owners that a downturn in bookings through winter was soon to turn around. “The winter months have always been a slow season for the car rental market,” the email read. “The decline in earnings you may have experienced over the winter months is primarily due to the broader rental market seasonality and based on historical trends, trip volume begins picking up again from September onwards.”

Stakeholders have not received any communication from Uber about the closure as yet, with car owners, reliant borrowers, and even Uber’s staff seemingly left in the lurch. Car sharing competitors to Uber’s platform in Australia include US-based Turo and Singapore-based Drive Mate, while there are also a number of subscription services such as GoGet, which own the vehicles they distribute.

Are you an Uber Carshare borrower?

If you’re a borrower with Uber Carshare, don’t worry! We’ve got you covered with our post, “Where do I go now?” If you’re on good terms with a specific Uber Carshare car owner, you can potentially message them as they may simply move to another platform.

Are you an Uber Carshare owner?

Listing on other P2P platforms

There are two other peer-to-peer car sharing platforms currently available in Australia, Turo and DriveMate. A quick summary of the eligibility requirements for each are below, though you should visit their respective websites for more detailed information. You can also rent your own cars out privately, direct to your customers, but we would advise against it unless you have prior experience or can work with someone who does.

Turo

• Age and Condition: Vehicles must be manufactured no earlier than 2013, have fewer than 200,000 kilometers.
• Registration: Must be a registered passenger vehicle in Australia with permanent or temporary plates.
• Insurance and Safety: Vehicles must have functional seat belts and pass a vehicle history report.
• Value: Have a fair market value of up to $200,000 based on third-party vendor determination of vehicle value at the time of listing.
• Locations: Cars can be listed in major cities including Sydney, Melbourne, Brisbane, Perth, Adelaide, Gold Coast, Cairns, Darwin, Hobart, and more.

DriveMate

$25 referral credit with this link.

• Age and Value: Vehicles must be manufactured no earlier than 2010 and have a value of less than $50,000.
• Registration: Must be legally registered in Australia and have a clean title (not branded or salvage).
• Condition: Vehicles must be well-maintained and meet DriveMate’s safety and maintenance requirements.
• Type: Only private passenger vehicles with four wheels are accepted; motorcycles and commercial vehicles are not eligible.
• Locations: Cars can be listed in cities such as Sydney, Melbourne, Canberra, and other major urban areas.

Evee

Selling fleets of 5+ vehicles

In Australia, the number of vehicles you can sell within a year without a dealership licence varies by state:

• ACT and Tasmania: Up to 6 cars per year.
• New South Wales, Queensland, South Australia, Western Australia, Victoria, and Northern Territory: Up to 4 cars per year.

Selling more than these limits requires a Motor Vehicle Trade licence.

“Owning” your client base

This is a good example of not “owning” your client base. Uber owned the clients; owners simply provided a service. If you choose to move your cars to a new platform, you may want to set-up a Facebook Page and incentivise your borrowers to give you a like, or simply create an email list. This way, you “own” your client base and can take them with you when you move platforms or simply go it alone without a platform.