The rental service in Honolulu would be the first large-scale operation in the state
POSTED: 11:32 a.m. HST, Jan 14, 2014
An affiliate of German carmaker Daimler AG is interested in establishing a car-sharing service in Honolulu, where 150 or so of Daimler's small Smart cars would be deployed on city streets available for public use.
Daimler's Car2go could become the first large-scale car-share operation in Hawaii, making Honolulu one of numerous cities adopting such programs that add a flexible new transportation option that industry proponents say reduces private car ownership and energy consumption.
Car-sharing lets customers access a fleet of cars using smartphones and smartcards at rental rates typically charged by the minute or hour. Members find and reserve cars online and, depending on the service, can leave them within a broad service area or at designated rental and return spots.
The industry emerged in the U.S. in 1998 and has expanded greatly in the last roughly six years, according to a report co-authored by Susan Shaheen, co-director of the Transportation Sustainability Research Center at the University of California at Berkeley.
Major industry players include Zipcar, Car2go, City Carshare and Enterprise CarShare, formerly known as WeCar.
Business models vary, and have been deployed in cities for the general population and for groups including residents of specific neighborhoods, university students and faculty, government employees and large companies.
In Hawaii, industry proponents see strong potential for the fast-growing trend.
"I definitely think the timing is right for this type of service," said Jeff Mikulina, executive director of the environmental organization Blue Planet Foundation. "Hawaii is the perfect place."
To date locally, only a few small-scale car-share operations have started up in the last few years.
GreenCar Hawaii claimed to be the first, deploying six cars in mid-2010 at two resort locations on Kauai and then later expanding to Waikiki. GreenCar Hawaii, however, has ceased operations.
Enterprise CarShare deployed two cars at Hawaii Pacific University's Kaneohe campus about two years ago and followed six months later with four cars at the University of Hawaii at Manoa.
Car2go could be the next entry.
The company participated in an information briefing Monday at the Legislature and shared its interest in establishing service here possibly with up to 150 cars based within a 15- to 20-square-mile area of Honolulu where cars would be available for pickup and drop-off in public parking spaces.
Walter Rosenkranz, a Car2go business development manager, said Honolulu is viewed as a ripe market because of its density, public transit options and the high cost of operating cars.
"We think Honolulu is a terrific market," he said, noting that the exploration is in a relatively early stage with no timetable or certainty for launching service.
A significant roadblock for the industry in Hawaii is the application of a $3-a-day state rental car surcharge to car-sharing. Industry supporters say the fee allows taxing the same car multiple times a day, and that the fee represents a major portion of a typical customer charge that discourages use.
In each of the last two years, bills were introduced at the Legislature proposing to prorate or exempt the daily rental car fee for car-sharing, but they did not pass. Car2go intends to lobby for a bill this year proposing an alternate fee that makes car-sharing more viable.
Shem Lawlor, a planner with the city's transit-oriented-development division, expects Hawaii will attract more interest from car-share operators without the rental car surcharge applying per trip.
Lawlor, however, also noted that educating people about the concept and benefits of car-sharing is another obstacle. "People don't give up their car overnight," he said.
One initial perception of car-sharing by consumers is that it costs a lot, Lawlor said. Enterprise CarShare costs $10 an hour. Car2go's typical pricing is 41 cents a minute, or $14.99 an hour.
Industry proponents say such prices become economically attractive when considering the total cost of car ownership, including buying a car and paying for gas, insurance, maintenance and parking.
With car-sharing, gas and insurance are covered by the rental fee. In the instance of Car2go, the company pays municipalities for the use of public parking.
According to Shaheen's report, a survey of car-share members in North America showed that half the members either got rid of or avoided buying a vehicle.
Shaheen's study reported that nine to 13 vehicles might be removed from the road for every car-share vehicle.
A fleet of 150 car-share vehicles in Honolulu could take 1,350 to 1,950 vehicles off the road based on that measure.
Mikulina noted that there are 1.1 million registered vehicles in Hawaii — more vehicles than there are licensed drivers.
Another benefit to car-sharing is reduced vehicle use that translates to reduced energy use, according to industry proponents who say car-share members become more efficient making trips in a car when they pay by the minute.
Rosenkranz said 90 percent of Car2go trips are less than 30 minutes. "You only pay for the time you drive the car," he said.