Where is the future of car-sharing amid the tide of financing?

In February, the car-sharing brand "PonyCar" announced the completion of a 50 million yuan angel round of financing. In the future, it will set up outlets in Beijing, Shanghai and Guangzhou, with Shenzhen as the base. In March, Youyou Car announced the suspension of operations and refunded all user account deposits, saying that the direct reason for the suspension was that "the previously signed investment funds were not in place as scheduled." This is also the first case of collapse among the first batch of companies in the domestic car-sharing industry. Then, the time-sharing rental platform Bagu Travel completed a 10 million yuan angel round of financing, which will be used to improve the level of operations and expand the city, and to create a travel ecosystem centered on Beijing, Tianjin and Hebei.

These are some representative news about shared cars after the Spring Festival. Compared with the booming financing of shared bicycles, the shared car market seems a bit tepid.

When the concept of car-sharing first entered China, it coincided with the start-up period of China's new energy vehicle industry. As a short-term rental sharing model, it became well-known only after Avis launched the "time-sharing car rental" business in 2011. Therefore, the development speed of car-sharing in China was not fast. It was not until 2015 that time-sharing car rental players emerged one after another, and the few well-known ones were CAR2GO, Microbus, EVCARD and Beijing Auto's Green Dog. It was not until 2016 that there were about 30 large-scale enterprises, and 2016 was also called the first year of the development of time-sharing rental.

Take Shenzhen as an example. In 2015, there were many companies developing time-sharing rental services, including Jinqianchao, Xingzhiyoudao, Liancheng Sharing and Chepu Zhidou. Later, Ponycar and Zhongdi Car Rental appeared, and Tusong quickly entered the Shenzhen market in 2016. It seems that many players are competing for the market, but so far, no unicorn company has been formed. Frankly speaking, the time-sharing rental market in Shenzhen has not yet taken shape.

Heavy asset operation. Compared with the unit price of shared bicycles, which ranges from a few hundred to a few thousand, the cost of new energy vehicles, which ranges from tens of thousands to hundreds of thousands, is too high. If too few vehicles are put into use to cover the market, this goal cannot be achieved. Secondly, at present, new energy vehicles account for as much as 95% of the time-sharing rental vehicles on the market. Pure electric vehicles need to be charged, which means that charging piles and charging stations and other equipment facilities must be able to support the charging needs of vehicles. Otherwise, the more vehicles there are, the bigger the problem will be.

It is difficult to find a parking space. This is a commonplace problem. Shenzhen is a typical city with a large population and limited land. Parking is also a particularly obvious problem in Shenzhen. Insufficient parking spaces mean that there are not enough stations to support the operation of time-sharing rental projects. In terms of traffic safety, shared cars cannot be parked on the roadside like shared bicycles. There must be sufficient parking spaces and charging piles. This is particularly obvious in Shenzhen, where every inch of land is valuable.

License resources. Like other cities with traffic restrictions and purchase restrictions, licenses are also one of the obstacles for time-sharing rental companies to grow bigger and stronger. At present, although it is easy for individuals to apply for new energy vehicle licenses, there are only four companies in Shenzhen that can apply for enough licenses from government departments every year: Chepu, ZTE, BYD and Liancheng Sharing. There are too many wolves and too little meat. Without sufficient license resources, the proposition of time-sharing rental will be difficult to establish.

The operation model is not yet mature. According to the author's investigation, some time-sharing rental companies have not yet matured their models and have not perfected the operation and maintenance sectors, which have led to complaints from the venue, and ultimately the cooperation between the two parties has come to nothing. The model mentioned here is not simply to put the car on the market, or to answer customer service calls. The operation and maintenance we are talking about is only one part of the operation model. The operation model also involves the venue, after-sales, maintenance and vehicle dispatch, as well as the corresponding systems of the time-sharing rental company, etc. If there is a problem in any of these links, the entire process will be affected.

Public acceptance. Not to mention time-sharing rental, for a period of time after the purchase restriction order, the promotion of new energy vehicles can be described as difficult due to the impact of awareness. In the minds of Chinese people, the first car of a family is mostly selected based on practicality or price. When new energy vehicles and time-sharing rental appear, it will take time for them to be accepted despite the vigorous promotion of enterprises. From another perspective, the Shenzhen Municipal Government has issued relevant documents since 2010, stipulating that charging piles should be built as supporting facilities for housing in residential areas under construction. To this day, except for the charging pile companies in the industry that pay for the construction, the number of residential areas that use charging piles as supporting facilities for the community is very small. Even the installed charging piles are not used very often. Therefore, the public's acceptance has naturally become a factor that makes it difficult to promote and popularize the project.

Apart from the influencing factors of hardware facilities, the time-sharing rental industry also faces many constraints in software development. Although there are countless local software development companies in Shenzhen, and there are also many well-known large companies. However, according to the author's investigation, these companies have only built similar software platforms. Among the dozen or so development companies contacted, the quotations from each company are different. From this perspective, it also proves that many companies are still exploring the software development of time-sharing rental, including the minute-by-minute rental companies themselves, what functions to set, what pain points and needs of consumers to solve, how to improve and upgrade in the later stage, etc. At present, they are constantly trying and improving.

At the same time, time-sharing rental companies rarely set up their own IT teams. On the one hand, they don’t know where to start, and on the other hand, the cost of setting up a team is too high. Outsourcing projects cannot guarantee the stability of the platform. In the early stage of promotion, the number of members is small and it can barely support operations. Once the number of customers increases, especially when the number of car users increases sharply in the same time period, the system may crash and become unusable, which will affect the customer experience and is not conducive to brand promotion.

Even the later addition of platform functions and version updates to achieve the “four-in-one” of vehicles, charging piles, PCs and mobile terminals require a lot of money, manpower and material resources to coordinate and communicate. In an industry where customer experience is king, being a step behind will result in more than just losing the market.

It is not difficult to understand why shared bikes are frantically raising funds, while the shared car industry seems to be calm. Apart from the investment costs, shared cars cannot be promoted by simply raising tens of billions of yuan in terms of site construction, platform building and industry promotion. In addition, the industry itself is not yet mature, so it is understandable that many investors choose to wait and see.

It is undeniable that the financing obtained by Ponycar and Bage Travel is indeed good news for the industry. At least, we can see that the industry still has a direction for development. However, it takes time to cultivate the market of an industry. On the premise of obtaining financing to become bigger and stronger, it is what all time-sharing rental companies should do now to explore a mature and sustainable development path.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.