Case Study on Zip Car

Executive Summary-

Zipcar, Inc., together with its subsidiaries, operates a car sharing network. It provides self-service vehicles that are located in reserved parking spaces throughout the neighborhoods where they live and work to its members. The company offers its solutions to individuals, universities, businesses, and government agencies. It operates a network of approximately 775,000 members and provides services with approximately 9,000 vehicles in 20 metropolitan areas college campuses in the United States, Canada, the United Kingdom, Spain, and Austria. Zipcar, Inc. was founded in 2000 and is headquartered in Cambridge, Massachusetts. As of March 14, 2013, Zipcar, Inc. operates as a subsidiary of Avis Budget Group, Inc.

Zipcar is a car-sharing company whose mission is to make it as easy for city residents to get behind the wheel of a car as it is to get a coffee or paper. This was not the first car-sharing business model, but it was a new concept in the U.S., which meant that there was plenty of opportunity and growth potential serving this new market niche, the urban, car-less residents in the U.S. Members could get a car without the hassle having to pay for insurance, buy gas, or try to find parking on city streets. Zipcar was making a strong case for city residents to not own a car depending of course on how much they actually drove. Zipcar’s goal was to provide reliable and convenient access to on-demand transportation, complementing other means of mobility (Zipcar.com). They offer a viable service that would not be possible to build, operate, scale, or sustain without the Internet and other technological infrastructure.

Now serving 650,000 members with 9,500 vehicles across the US, Zipcar is the world’s leading car sharing network, but now faces several strategic issues that it must address. With established car rental agencies such as Hertz and Enterprise breathing down Zipcar’s neck, the firm must maintain its competitive edge, continue expansion and become profitable to stay in the industry.

History/Background of Zipcar, Inc.

Started by Antje Danielson and Robin Chase in January 2000 in Cambridge, Massachusetts, Zipcar came into the marker riding its first mover advantage. Aware that the concept of car sharing was foreign to the US at this time, the two brought this idea over from Europe with the intent of creating a phenomenon.

The first Zipcars hit the roads in Boston, MA in June 2000 and soon followed in Washington, DC and New York city. Major metropolitan areas were the main targets due to traffic and parking issues that residents faced on a daily basis. The goal was to give these consumers a viable alternative to car ownership allowing them to use strategically placed Zipcars by simply reserving online or over the phone.

After its initial three