WILL CAR OWNERS TURN TO SHORT-RENT SCHEMES?
▶ Since Dubai allowed per-minute hire, demand is growing ‘like crazy’
Elie Youssef perfectly fits the description of the ekar pay-perminute car service’s average user.
Mr Youssef is in his mid-30s, is tech savvy and accustomed to using apps made for the sharing economy. He is part of the demographic experts say may one day no longer own their own vehicles, thanks to the rise of car-sharing services.
Ekar and competitor Udrive won contracts with Dubai’s Roads and Transport Authority to provide pay-per-minute car hire. They initially launched their services with 100 cars each early last year.
Ekar is adding another 100 cars to its fleet, which are more high-end than its original Nissan Tiidas.
“For our second tranche of cars we are launching some BMW Minis and some Infinitis,” said Petter Moen, ekar’s general manager. “So it’s going to be really exciting to see how the market reacts to that.”
Udrive, which claims to have a market share of about 70 per cent, has 400 vehicles. Both companies plan major expansions this year.
Ekar aims to have 500 to 600 cars on the road by Ramadan, while Udrive is looking at 1,000 by the end of this year or the start of next.
Both of the companies are struggling to keep pace with demand.
“Right now we have about a 20 per cent increase month-onmonth,” Mr Moen said. “Our biggest challenge now is to get enough cars on the road.
“A luxury problem, but nevertheless a problem, is that we have 100 new customers signing up every day.
“If they open up the app and they don’t see enough cars on there they say, ‘OK, fine, I just downloaded the app. Let me try again in a couple of days’.”
That is just about acceptable for the first time but the company would really struggle to keep hold of new customers if they could not find a car the second time, Mr Moen said.
Udrive, which has had more than 150,000 trips since January last year and more than 100,000 hours of use to date, is experiencing growth of 20 to 30 per cent each month.
“The last couple of months since the end of last year, it’s been picking up like crazy,” said Hasib Khan, the company’s chief executive and founder.
Mr Khan said the reason is more people are learning about the service. And as they do, they tell others.
“If you have 25,000 people who know about you and they each tell five people, you have 125,000 people speaking about you,” he said.
“So this for me is the major thing. It’s like a snowball that runs down the hill and gets bigger and bigger and bigger.”
Mr Khan said car-sharing services were the future and he had been approached by many who had sold their cars or were thinking about it.
Mr Youssef, 35, British-Lebanese man who has lived in the UAE for 13 years, first used ekar when his own car was in the garage for a service, but he would consider getting rid of it “if there were more options”.
“As they increase their fleet and locations in the city, it would be more feasible to consider giving it up,” he said.
Mr Moen also sees a big future for car sharing. “We just had a meeting with one of our partners, Volkswagen, where we discussed this,” he said.
The business model has proved very successful in the US and Europe in cities with high densities.
“In the short term in Dubai, we see a very bright future but where we see the market going in five years or 10 years is more towards self-driving cars,” Mr Moen said.
“So car-sharing 2.0, if you want to call it that. The next step – where you share cars but you don’t drive them yourselves.”