Car2Go to roll out of Toronto
Car-sharing company blames city’s parking rules
Just hours after Car2Go announced it would cease operations next week in Toronto, blaming city council for implementing parking restrictions that has made business “inoperable,” councillors voted for staff to swiftly review those restrictions.
Councillors on Thursday did not, however, reverse the rules that go into effect June 1 as part of an 18-month pilot project on car sharing.
“I’m not going to be bullied the way that Uber and Airbnb tried to bully this council. I think we came up with a reasonable compromise on how to do this,” Councillor Gord Perks said.
Car2Go said it won’t be able to successfully operate in Toronto because the city will not allow users to park cars on residential streets that are at 95 per cent of capacity for parking permits, or where there are wait-lists for permits.
The new rules would also require the company to pay $1,500 per vehicle for street parking permits — the highest fee Car2Go said it has encountered in North America.
The company also said Thursday that it would shut down in Columbus, Ohio, at the end of the month because of low membership, as it has done in two other cities.
Car2Go is the only car-sharing company in Toronto that offers a “free-float” model, allowing users to pick up a car without having to return it to the same spot.
“The pilot (project) passed by city council is so restrictive, costly and unwieldy it seems purpose-built to make free-float car share for Torontonians impossible,” Paul DeLong, CEO of Car2Go North America, said in a statement.
Car2Go, which operates in 26 cities around the world, said 80,000 Torontonians currently use its service.
The company said its membership increased by 51 per cent when it made vehicles more accessible in 2016 with an on-street parking option, which it uses in every other city where it operates.
Vanessa LeBlanc, 31, signed up with Car2Go around that time. Now, she spends about $35 a month on the service, often to get to shows and restaurants in far-flung corners of the city, or for a one-way trip to work when the subway is delayed.
She said she was “very disappointed” when she heard Car2Go was leaving Toronto and understood its frustration with the city’s pilot project restrictions.
“It signals Toronto is not open to innovation, a sharing economy or technology,” LaBlanc said. “Council’s actions show there’s still an old way of thinking at play.”
Before passing the pilot project last month, councillors said residents moving into some neighbourhoods were finding it hard or impossible to get onstreet permits, and argued car-share needs shouldn’t trump those of homeowners.
Mayor John Tory said in a statement that the company chose confrontation over collaboration with city council.
“In fact, through the course of discussions with the city about reasonable concerns shared by many Toronto residents, their response was to repeatedly threaten to leave the city,” Tory said. “While their decision to suspend operations in Toronto is unfortunate, it is their decision alone to walk away from a clear path toward regulations that would allow them to operate in our city in a reasonable, compatible way.
“I’m confident that other car-sharing companies willing to work with us and to operate in this manner will succeed in Toronto.”
DeLong said the company worked with the city for nearly six years on developing regulations and still faced restrictions not seen elsewhere.
“Other cities around the world — including Vancouver, Montreal and Calgary — have fully embraced our service because of the numerous economic and quality-of-life benefits free-float car sharing brings to their cities,” DeLong said.
Last summer, Calgary implemented new parking rules limiting Car2Go to 25 per cent of a paid parking zone per month, CBC reported. Earlier this year, city staff reported to council that the strategy had been successful.
Montreal expanded the areas in which Car2Go and other car-sharing users can park the cars, according to the Montreal Gazette. These areas included large areas of downtown previously off limits.
The Star Vancouver recently reported Car2Go was experiencing a boost in car bookings and memberships there.
Things didn’t go so well in San Diego, where Car2Go withdrew its fleet of electric cars at the end of 2016 due to the rapid rise of Uber and Lyft and delays in installing charging stations, reported local media.
Copenhagen was a bust, too. Car2Go announced in January 2016 it had failed to attract enough members to keep operating.
Toronto city staff will review the pilot project and report back to council next month, instead of in six months as originally planned.
“I want to understand what the whole (car-share) industry thinks, not just this one company that has for years been breaking city laws (by telling users they can park on residential streets) and now wants to tell us how to manage city streets,” Perks said.
In 2017, Car2Go racked up 42,595 parking infractions totalling more than $1.1 million in fines, of which the city has collected only 34 per cent, said a staff report. Car2Go will consider reinstating service “if the City of Toronto one day chooses to establish a legal framework that makes true free-float car-share possible in the same way that dozens of other global cities have,” said spokesperson Kendell Kelton.
Communauto, a Montreal-based carsharing service based, announced plans Thursday to expand into Toronto following Car2Go’s announcement.
“(The pilot) is not a perfect solution. There are a lot of things that need to be revised,” said Communauto vice-president Marco Viviani, “but we think it’s a compromise that’s acceptable to at least start doing something in Toronto.”