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A community kitchen in Rotherhithe has provided hundreds of prepared dishes each week for the past two years to pensioners and needy locals in south London. However, the group's plans have been thrown into disarray by the news that they will lose use of New Year’s Day.

The group depended on Zipcar, the app-based vehicle rental service that customers to access its cars from the street. It sent shockwaves across London when it said it would shut down its UK business from 1 January.

This means many helpers cannot pick up supplies from a major food charity, that collects excess produce from supermarkets, cafes and restaurants. Obvious alternatives are further away, more expensive, or lack the same flexible hours.

“It’s going to be affected massively,” stated Vimal Pandya, the community kitchen’s founder. “Personally me and my team are concerned by the operational hurdle we will face. Many groups like ours will face difficulties.”

“Faced with this reality, they are all worried and thinking: ‘How are we going to carry on?”

A Major Blow for Urban Car-Sharing

The community kitchen’s drivers are among over 500,000 people in London who were car club members, who could be left without easy use to vehicles, avoiding the burden and cost of ownership. Most of those people were probably with Zipcar, which held a dominant position in the city.

The planned closure, pending consultation with staff, is a serious setback to the vision that vehicle clubs in cities could cut the need for private vehicle ownership. However, some experts also suggested that Zipcar’s departure need not mean the demise for the concept in Britain.

The Potential of Shared Mobility

Shared vehicle use is valued by many urbanists and environmentalists as a way of reducing the ills associated with vehicle ownership. Typically, vehicles sit idle on the side of the road for the vast majority of the time, using up space. They also require large CO2 output to produce, and people who do not own cars tend to walk, cycle and take public transport more. That benefits cities – reducing congestion and pollution – and boosts public health through increased activity.

Understanding the Decline

Zipcar was founded in 2000 before its acquisition by the American rental giant Avis Budget in 2013. Zipcar’s UK revenues barely registered compared with its parent company's overall annual revenue, and a deficit that reached £11.7m in 2024 gave little incentive to continue.

The parent company stated the closure is part of a “broader transformation across our international business, where we are taking deliberate steps to streamline operations, enhance profitability”.

Zipcar’s most recent accounts said revenues had declined as drivers took less frequent, shorter trips. “These changes reflect the continuing effect of the cost-of-living crisis, which is dampening demand for non-essential services,” it said.

London's Unique Challenges

However, industry observers noted that London has particular issues that made it difficult for the company and its rivals to succeed.

• Inconsistent Rules: With numerous local councils, car-club operators face a patchwork of varying processes and prices that complicate operations.
• Congestion Charge: The closure coincides with electric cars becoming liable for London’s congestion charge, adding extra expenses.
• Unequal Parking Fees: Locals in some boroughs pay as little as £63 for a annual electric car parking permit. A similar shared vehicle would pay over £1,100 annually, creating a major disincentive.

“Our fees should be one-twentieth of a resident’s permit,” argued Robert Schopen of Co Wheels. “We’re taking cars off the street. We’re putting less polluting cars in their place.”

A European Example

Other European countries offer models for London to follow. Germany enacted national shared mobility laws in 2017, providing a nationwide framework for parking, subsidies and waivers. Now, the country has 5.4 shared cars per 10,000 people, while France has 2.1 and Belgium has 6.3. The UK lags behind at 0.7.

“What we see is that shared mobility around the world, especially in Europe, is expanding,” said Bharath Devanathan of Invers.

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

What Comes Next?

The company’s competitors can roughly be divided into two camps:

1. Company-Owned Fleets: 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 hire out their own vehicles via an app – similar to Airbnb for cars. Examples Britain’s Hiyacar and the US’s Getaround and Turo.

One company, a US-headquartered peer-to-peer platform, is assessing the UK gap. Rory Brimmer, its UK managing director, said there was a “big opportunity” to win more users. “There is a void that is going to need to be filled, because London still needs to move,” Brimmer said.

Yet, it could take a while for other players to build momentum. In the meantime, more people may feel forced to buy cars, and others across London will be left without access.

For Rotherhithe community kitchen, the coming weeks will be a scramble to find a way. The delivery problem caused by Zipcar’s exit highlights the broader impact of its departure on vital services and the future of car-sharing in the UK.