Denver Transportation, Part One: Car and Ride Sharing

Denver residents are taking a pole position in the trend that has nearly one million Americans ditching the hassle of car ownership in favor of car- and ride-sharing services.
This is the first feature in a three-part series covering the future of transportation in Denver. Next week: Front Range rail.

George Ferris and his wife moved from Oklahoma City to Denver’s Capitol Hill almost three years ago. Naturally, they brought their two cars with them because, in Oklahoma City, "everything is 100 miles apart."
But soon after unpacking and settling in, Ferris discovered that short trips were far easier and cheaper to accomplish through Denver’s B-cycle bike-sharing program. As a result, their two cars sat largely unused. What to do?
Enter eGo CarShare, a nonprofit car-sharing service that launched in Boulder 10 years ago. Today, the operation manages 15 cars in Denver and 25 in Boulder and counts 2,500 members. eGo’s cars (mostly Toyota Prius hybrids, Honda Fits and Nissan Versas) sit at key locations throughout the Denver metro area. Members can reserve a car anywhere from 15 minutes to 48 hours or longer.

"We sold both of our cars and converted over," Ferris says. "I don’t think I’ll ever get a car again."
"We sold both of our cars and converted over," says eGo CarShare customer George Ferris. "I don’t think I’ll ever get a car again."

eGo rates vary, but Ferris currently pays around $6.50 per hour and $0.30 per mile, and uses the service around half a dozen times per month -- mainly for shopping trips to Target or Ikea but sometimes to shuttle photography equipment to client locations. Occasionally, Ferris will pay the $75 all-day fee to get the car with the bike rack on the roof (parked at REI, naturally) in order to do some mountain biking.

A Growing and Necessary Trend

Ferris is on the leading edge of a major trend in the United States. According to the Transportation Sustainability Research Center at the University of California Berkeley, a total of 806,332 people in the United States shared 12,634 cars as of July 2012. Globally, there are car-sharing operations in 27 countries and five continents, accounting for around 1.8 million members and 43,550 vehicles.
Members of eGo CarShare can reserve a car for 15 minutes to 48 hours.The research center doesn’t break out statistics for the city of Denver, but the two major car-sharing organizations in the city -- eGo CarShare and OccasionalCar -- count a total of 4,200 members. And car sharing is an important trend, says Steve Erickson, communications and marketing director for the Denver Regional Council of Governments (DRCOG). He says that more 14 million motor vehicle trips are made each day in the Denver metro area, and more than four million of those trips are less than 1.7 miles in length.

Perhaps more importantly, he says the population in the Denver area is predicted to grow from 2.5 million to more than four million in 2035. That figure, based on the current level of city traffic, "is kind of a sobering statistic," he says.

Alyssa Alt, program manager for eGo CarShare, says the operation is adding around 100 new members per month. She says users are attracted to the simplicity and usefulness of the service, which covers the gas, insurance and maintenance. Most cars are used every day and eGo CarShare members generally live and work in Denver and are "tech-type people."

Next year, Alt says eGo CarShare plans to add 10 new cars next to B-cycle stations, thanks to funding from DRCOG. The ultimate goal is to "get people out of cars."
LoHi resident Roxanne Pizano is another eGo CarShare customer who is doing just that. She and her husband moved to Denver a year ago with one car and soon discovered they only used their vehicle once a week. They too switched to car sharing. 

"We did the math," she says. "It was a just a huge, huge savings."

Today, Pizano says she uses eGo service once a month and rents cars from traditional car-rental businesses for longer trips. 

"We pretty much walk and bike everywhere," she says.
So how big is the business for car sharing in Denver? Russell Straub, the founder and CEO of OccasionalCar, says his company is now cash-flow positive, though he declined to provide specifics.

Based in Evergreen, Straub and his business partners launched OccasionalCar in 2009 with two cars. After the first month, it counted only 12 members. 

"That was a little scary," Straub says. Now, however, business is picking up. Today, OccasionalCar has 1,700 members and 31 cars in Denver. OccasionalCar company will add new cars next year after a six-month pause during which Straub will acquire additional parking spaces for company cars.
"In the absence of an alternative, people will buy and own their own cars," Straub explains. He says the average age of OccasionalCar’s members is 44. In a survey conducted a year ago, the company found that two-thirds of its members used the company’s cars for errands; 20 percent used them for visiting friends; and around 10 percent used the cars for leisure or business trips.

Enterprise Rent-A-Car is the third car-sharing operation in Denver, according to Tom Boone, a program manager at DRCOG. However, that service is specifically intended for students and staff at the University of Denver.

Acquired by Avis in early 2013 for $500 million, Zipcar, the nation’s largest car-sharing service with 730,000 members and 10,000 vehicles in the United States, Canada, the United Kingdom, Spain and Austria, doesn’t have vehicles in Denver -- yet. But Zipcar does operate a handful of cars on the Colorado State University campus in Fort Collins. The company did not respond to questions about its plans for Denver.

A New Take on Borrowing An OccasionalCar vehicle.

OccasionalCar and eGo CarShare aren’t the only options for Denverites looking to ditch their vehicles. Peer-to-peer ride sharing is a related trend that appears to be in the very early stages of a major growth phase. Today, numerous ride-sharing operations are in the process of expanding into Denver with the goal of helping car owners rent idle vehicles.
"Anywhere where parking is a problem, that’s an opportunity," says Gaurav Kohli, CTO of JustShareIt. The company, founded in 2011 and based in San Francisco, expects to launch commercially in Denver early this year.

JustShareIt takes a high-tech approach to the old-school idea of borrowing a car: Car owners install a $300 box into their vehicle that allows them to rent their vehicle without meeting the borrower. The box connects the car to JustShareIt’s systems, allowing renters to set prices and availability, provide keyless entry, establish distance boundaries and immobilize the car in the event it is stolen.

"Anywhere where parking is a problem, that’s an opportunity," says Gaurav Kohli, CTO of JustShareIt.
JustShareIt’s technology has been installed into around 800 cars across the country, which are available to the company’s 15,000 registered users. The company offers up to $1 million in insurance and screens all renters.

"We have made car sharing much easier to use," says Kohli.

RelayRides, another ride-sharing service, expanded its operations nationwide in March. Spokesman Steve Webb says Denver was one of the first cities where car owners starting listing their vehicles as available to rent. A quick search of the company's website shows about 70 cars available to share in metro Denver.
"Currently, we have a great community in Denver," says Webb.

As RelayRides and its peers gain traction, look for the local community to get even more rubber on the car- and ride-sharing road.
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Read more articles by Mike Dano.

Mike is a freelance writer and executive editor of FierceMarkets Telecom Group.
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