Car2Go exits Toronto over parking fees

Vehicle-sharing firm has expectations of exemptions, David Booth writes.

Decried as out of touch and pro traffic-congestion, Toronto’s elected officials voted on a new pilot program that would start charging car-sharing companies for parking. Indeed, the city’s powers-that-be decided they would start charging giant Car2Go $1,500 — actually $1,499.02 — a year per car for the right to park nilly-willy across the GTA, and the car-sharing firm responded by announcing it would suspend operations May 31.

To proponents of “participatory car ownership,” this is big government standing in the way of progress: The fees are outrageous and will only serve to put a damper on the revolution that is congestion-reducing car-sharing. The implication is that Toronto’s city councillors are deliberately making traffic worse.

Or are they?

Why Car2Go? Before condemning The Big Smoke’s politicians as antediluvian, perhaps a little context is in order. The reason for singling out Car2Go is that the Daimler-owned car-sharing conglomerate is the only company in Toronto offering a one-way, or “free-float,” business model. While “two-way” car-sharing requires that said shared car is returned from whence you collected it, Car2Go allows members to drop their little Smart cars wherever their destination terminates.

The parking issue: The problem is that lots of these cars end up parked on crowded residential streets. Considering how tight downtown city street parking already is, the little Smarts, as diminutive as they are, are taking up parking spaces that are usually reserved by local — and paying — residents.

The crux of the matter: Although CEO Paul DeLong claims that the reason for Car2Go’s pullout is that “the pilot (project) passed by city council is so restrictive, costly and unwieldy it seems purpose-built to make freefloat car share impossible,” this disagreement would really seem more a matter of principle than economics. That $1,500 parking fee that is purported to be so contentious works out to an additional operating charge of about a half-million dollars per year. Shared among Car2Go’s claimed 80,000 Torontonian members, that works out to about six bucks per person per year.

But is Car2Go really all that valuable? One study — Impacts of Car2Go on Vehicle Ownership, Modal Shift, Vehicle Miles Travelled, and Greenhouse Gas Emissions — for instance, estimated that Car2Go’s sharing of vehicles reduced Vancouver’s automotiverelated greenhouse gas emission by some 15 per cent. The study’s own numbers, however, didn’t seem to back up that bold assertion, authors Elliot Martin and Susan Sheenan noting that only two per cent of Vancouver Car2Go members actually sold their personal automobile as a result of sharing a car.

Indeed, there’s some evidence that many Car2Go members were driving more, not less, as a result of this participatory car ownership. In Calgary, for instance, 30 per cent of those surveyed said they used the bus less once they joined Car2Go compared with just four per cent who said they used it more. And Car2Go’s Smarts seem to have an especially dramatic effect on taxi use, 65 per cent of Vancouverites saying they used cabs less versus just three per cent using them more.

In fact, the study reveals that 47 per cent of Vancouver Car2Go members drove more once they started “participating ” while only 15 per cent said they drove less. In other words, Car2Go’s ability to reduce congestion would seem not nearly as large as many contend.