11/26/2014

Young Drivers Flock to India’s Low-Cost Car-Share Services

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Indian companies offering low-cost rental cars by the hour are attracting young consumers eager to avoid the cost and care of owning their own vehicles, Bloomberg News reports.

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Indian companies offering low-cost rental cars by the hour are attracting young consumers eager to avoid the cost and care of owning their own vehicles, Bloomberg News reports.

The car-share companies charge customers as little as 45 rupees (73 cents) per hour to use their smallest vehicles. Fancier cars carry hourly fees ranging from 70 rupees ($1.13) for a Ford Figo hatchback to 1,200 rupees ($19) for a Mercedes-Benz E Class sedan.

Bloomberg says the services are promoting low prices to help overcome the social prestige associated with owning a vehicle. Typically, a customer uses a cell phone or computer to reserve a car and pick it up at a designated parking spot. Usage, insurance and maintenance are covered by the hourly fee.

Three shared-car startups Carzonrent, MiCar, Myles and Zoomcar report strong month-by-month growth, according to Bloomberg. All three are less than two years old. U.S.-based Zipcar Inc., which operates 10,000 vehicles in six countries, says it has no immediate plan to enter the Indian market.

Analysts predict car-share services will become very successful in India's urban areas, where public transport is poor but the costs of owning and parking a personal car are rising.