July 14, 2009

While the Credit Crunch and current recession has seen car sales plummet and manufacturers forced to go cap in hand for state bailouts, there is one area of the UK motoring industry that is showing growth – car clubs.

Put simply car clubs offer fully inclusive pay as you go car use.  Members don’t own the cars but pay a membership cost, typically £50 annually, and then pay a rental charge which can be as little as £3.96 per hour.

The growth of the internet has been the primary driver for schemes such as this as it enables users to book their vehicle, and arrange collection online.  The City Car Club and other schemes such as streetcar.co.uk offer flexible car hire running from hours to months.

The survey by Transport Research Laboratory found that there are now 61,000 car club members across the UK and asked City Car Club members how they had changed their motoring habits since joining a club and found that 41% of existing members and 39% of new joiners said they
had reduced their car ownership.

Car clubs suit the  nature of modern city living.  Many potential car owners don’t get the sort of use from a  car that makes it worth buying one.  Many commuters use public transport to get to and from their place of work and their social lives will be centred around that area.  This means that they really only need an occasional car, or a car occasionally.  Car clubs are the perfect solution to this as drivers are only paying at the point of use (OK with the exception of the membership fee).

The City Car Club has the following example of potential savings:-

Richard Vaughan, 36, a Technical Manager from Northolt Middlesex. He is married and has two young children.

Joined: 2008

Richard said: "I use the Car Club for business and personal use and I am so pleased with the amount of money I have saved.  We sold our second family car because there really was no need for it. So when I need the car for the school run I can book one at the click of a mouse, it is brilliant."

Annual Cost of Running a Car previously £1,457 Annual City Car Club bill £600 Money saved: £857 (£1,077 if depreciation is included)

Richard joined City Car Club in 2008 and spent £1,457 in the previous year to run his Citroen C2 1.1 . Richard spent around £600 over a 12-month period which is a saving of £857.

Without ancillary expenses such as insurance, repair, maintenance and breakdown cover car clubs are an attractive prospect. 

The only sticking point with schemes of this nature is the draconian restrictions on parking, especially in metropolitan areas. 

Car users can only apply for a parking permit, at their place of residence, for a specific car, not for any car from a specific car share scheme or car club.  This means that users are likely to have to use individual daily permits, which aren’t cheap.  It would be worth paying a little more for membership if there was the option of buying a flexible parking permit.

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