The Covid-19 pandemic has led to an increase in demand for a wide range of goods and services. For example, e-commerce experienced a huge boom as many Singaporeans opted to shop online instead of going to physical stores.
Another industry that has experienced huge growth in demand is car sharing. It refers to private owners who rent vehicles so that others can drive them or when a company has a fleet of vehicles that can be used for short-term rental.
According to one report published last year, car-sharing companies experienced an increase in demand at the time the movement restrictions were lifted.
During the first phase of the reopening of the economy in June 2020, Tribecar revenues increased by 40 percent, while Whizzcar experienced a 20% increase. On the other hand, BlueSG recovered the loss it suffered during the circuit breaker with a 50 percent jump in rentals.
For Drive lah, he saw one 20 percent increase in monthly income in April and May during the switch and the number of active users went from about 5,000 in April to 7,000 in June.
In addition, Statista states that the user penetration of car-sharing services is 6.8% in 2021 and is expected to reach 8.5% in 2025.
While car bo-sharing is clear, will this demand be maintained in the long run?
Car sharing may not be the most affordable option
One of the key aspects of car sharing is that it is considered to be the most affordable option when it comes to transportation in Singapore.
Eliminates long-term liabilities that result in a depreciating asset, such as a car. This is especially common in Singapore, where high vehicle ownership costs may not be practical over time.
In addition to paying the initial costs of a car and its certificate of entitlement (COE), it is possible that car owners expect to pay an average of $ 1,591 S per year car insurance, S $ 621 for maintenance / upkeep expenses, S $ 742 in circulation taxes and S $ 2,434 in gasoline expenses each year.
A recent discovery by Car Club shows that most cars are underused and stand idly by in car parks 80% of the time. Drive Lah investigations claimed Singapore sees 11,520,548 unused driving hours per day.
Unless you drive regularly, it is definitely a cheaper option for Singaporeans to use car sharing services.
However, we must also take public transport into account. Singapore has a very well-connected public transport system, which is more affordable than renting a car from car-sharing platforms.
In addition, the country also has a lot of special options, from Grab to Gojek, and even smaller players like TADA and Ryde. Here’s how the different car-sharing options in Singapore fit into public transportation:
According to the table above, car-sharing is the most cost-effective option, especially with companies like Shariot that offer extremely competitive rates from US $ 1 per hour.
One problem, however, is that many car-sharing platforms require users to pay a monthly membership fee, a registration fee, or to assume the cost of gasoline.
Convenience as a key design
Singapore is an extremely fast paced city and comfort is something that most Singaporeans value highly.
While car sharing can be affordable, it is not the most convenient option available. In fact, it is likely to take longer than booking a taxi or shuttle.
For example, though Tribecar has the most diverse fleet of rental vehicles such as motorcycles, vans and trucks, users have to return the car to the exact parking lot where they picked it up. As such, if the user did not pick up the car from a parking lot near their home, they should strive to return it when the rental ends.
The BlueSG electric car sharing company adopts a more comfortable “point A to B” model, in which users do not have to return the car to the same place where they picked it up. However, they will need to return the BlueSG car to a designated parking lot.
In addition, although the company it currently has a fleet of 667 shared electric Bluecar vehicles and 1,487 charging stations, it is still difficult to find a car, especially in areas where demand is high.
To Drive lah, is the first peer-to-peer vehicle sharing platform in Singapore that allows private vehicle owners to rent their vehicles. To pick up your car, you must meet with your host at a designated pick-up point, and once the time is up, you should return the car to your host.
Car sharing works as a short-term solution
Singaporeans seem unlikely to use car-sharing as a means of frequent transportation, such as trains, buses and even travel services.
In accordance with transport economist Walter Theseira of the University of Social Sciences in Singapore, car sharing will only work well in countries where “car capital costs are low and drivers’ costs are high ”.
However, in the case of Singapore, public transport and even public transport services are relatively affordable, making car sharing a less attractive option.
Demand for car-sharing is likely to fall when Singapore’s borders are gradually opened up and Singaporeans can venture abroad again.
Meanwhile, while Singaporeans could occasionally use car-sharing services for family outings or special long-distance travel, it is unlikely to become a means of daily transportation.
Featured Image Credit: GetGo