If I lived in a city with decent transportation options, I probably wouldn’t own a car. If I lived in a city with decent transportation and ZipCar, I definitely wouldn’t own a car. As it stands, we live in the suburbs so a car is a must but I am a little jealous of my friends who don’t have to take care of a 4,000 pound piece of metal on wheels. It also appears like I’m not alone. This article about the cheapest generation , a somewhat unfair characterization, mentions how Millenials aren’t buying cars and houses like their predecessors. It made me wonder about the economics of Zipcar and whether it makes sense financially, even if it’s not practical in our situation.
ZipCar is a service where you can rent cars for a very short period of time. You join their service, which involves a driving record check and a 94% approval in 24 hours, and are issued a card. You use that card to reserve cars that are (hopefully) distributed around your local area. You rent by the hour or by the day and can do so entirely online, which tells you whether there are cars there. It’s basically a la carte car rental. The technology  is actually pretty slick, you do everything with the Zipcard.
ZipCar is very well represented in cities  but you’d be hard pressed to find them out in the suburbs, though there are locations. For example, there are no Zipcars in Columbia, MD where I live and the closest one is at the University of Maryland, Baltimore County (next closest is in Baltimore or Washington D.C.). That’s not a viable option for me and it’s likely the case for folks living in the suburbs. If you live in a city, chances are you’ll see one nearby.
So would it make sense financially?
Is a ZipCar Worth It?
The simplest way to do a comparison is to compare the costs of owning a car versus the costs of simply renting it as needed. For our math, we’re going to take a look at “Magdalen,” a Mazda 3 that is sitting in a garage somewhere in Baltimore. What if you owned Magdalen?
Here is an estimate of the fixed costs:
- Parking – $150/mo
- Maintenance (from Edmunds.com) – $100 (7500 mi. service)
- Insurance – $600 (estimate)
Insurance and parking are the two biggest costs and maintenance isn’t really an issue until a car gets much older, but the $208 monthly cost of maintaining a car is equal to about three days of rental $68 per day. Depending on how much you’d pay for insurance in a given year, a ZipCar may be a good option if you anticipate needing for fewer than 3 days a year. There’s also an hourly option, at a price of $8.50 an hour. That’s about 24 hours of rental time for your $208 a month.
That’s only the straight up numbers on the bare minimum you’d be spending. You won’t need to wash the car, vacuum the car, or do any of the other small maintenance items that you’d do if you owned the car. No need to replace windshield wipers, fill up the oil, fill up the washer fluid, etc. Those are minor costs, where your time is likely more valuable than the price of the items, but those can be avoided entirely.
Lastly, I’ve heard of many people who replace a second car with ZipCar. You keep one vehicle so you have one on hand no matter what but you drop the second one and rely on ZipCar in case of emergencies.
Have you used a ZipCar? Are you one of the many who dropped a second car in favor of this on-demand capability?
(Photo: rj_schmidt )