OEMs hitting the ground of Peer-to-Peer car sharing

21 Feb 2024 | 4 min read

Peer-to-Peer car sharing Market is expected to grow at a CAGR of over 22% during 2021-2027, reaching USD 5.4 billion by 2028.

Traditional and emerging OEMs are focusing not only on the car rental or car subscription market but also on rising markets within the Peer-to-Peer car sharing industry, considering the exponential interest and vibrant growth this market is showing. For example, there are platforms dedicated to luxury car rentals, vintage and classic cars, and other specialized vehicle types.

These platforms cater to specific customer segments seeking unique and memorable rental experiences.

OEMs are therefore moving from production only to selling services too.

The shared mobility model will offer OEMs an opportunity to focus on another branch and start selling services: one of the most promising sectors today is connected Peer-to-Peer car sharing and Mobility as a Service (MaaS). Within these trends, OEMs will get an opportunity to move into the profitable markets of Peer-to-Peer car sharing and new mobility, leading OEMs to increase their future mobility offerings and capture additional revenues.

Today more than ever, OEMs market dominance will not hinge on providing the most cost-effective vehicles, but rather on delivering cutting-edge technology, an extensive array of digital services, and seamless accessibility to on-demand mobility solutions.

Strategy 📚

Diversification: OEMs are diversifying their business models beyond traditional car sales and leasing, aiming to tap into the growing P2P car sharing economy to diversify the offer and outgrow their performance.
Market Expansion: Entry into the P2P car sharing market allows OEMs to access new customer segments and geographic markets while hitting new grounds.
Technology Integration: OEMs are integrating advanced technologies such as IoT, telematics, and mobile apps to facilitate efficient Peer-to-Peer transactions and enhance user experience.
Brand Building: Participation in the Peer-to-Peer car sharing economy enables OEMs to build a stronger brand loyalty and increase brand visibility among younger, tech-savvy consumers.

Motivation 💪🏼

Revenue Generation: Peer-to-peer car sharing represents a new revenue stream for OEMs through transaction fees, subscription models, and partnerships with Peer-to-Peer car sharing platforms.
Customer Engagement: By offering these kinds of services, OEMs can engage directly with consumers, gather valuable data on usage patterns, and tailor future product offerings accordingly.
Sustainability: Participation in the sharing economy aligns with the growing emphasis on sustainability and shared resource utilization, enabling OEMs to focus resources on environmental responsibility.
Competitive Advantage: OEMs entry into the Peer-to-Peer car sharing market is perceived as a means to differentiate themselves from others and stay ahead of the competition in the automotive landscape.

Benefits ⭐️

Additional Revenue Streams: Peer-to-Peer car sharing can generate an additional revenue stream for OEMs beyond traditional sales and leasing models.

Enhanced Brand Image: Participation in the sharing economy enhances the brand image of OEMs as innovative, customer-centric organizations.

Data Insights: Peer-to-Peer car sharing services provide OEMs with valuable insights into consumer behavior, preferences, and usage patterns, which can inform and enhance product development and marketing strategies.
Expansion in the market: Venturing into the Peer-to-Peer car sharing sector allows OEMs to access new customer demographics and geographical regions, thereby fueling comprehensive business expansion.

The Lynk&Co use case

Link & Co is a subsidiary of Geely Auto, a Chinese automotive company known for its ownership of Volvo Cars and other brands.
The brand was officially launched in 2016 with a focus on developing vehicles that are highly connected and tailored for shared mobility solutions. Lynk & Co has adopted a business model that integrates car sales with a subscription and sharing approach. This model has been compared to streaming services such as Netflix, where customers can enjoy a car without physically owning it through a monthly subscription.

The brand is pioneering a car-sharing approach to prioritize the European market expansion and address the inefficiency of traditional car ownership. Through its app, Lynk & Co enables owners to share their vehicles, aiming to maximize car usage and reduce urban congestion. Lynk & Co has established a community centered on Peer-to-Peer car sharing, collecting over 1.5 million hours of shared mobility. Emphasizing sustainability and inclusivity, the company asserts that car sharing transcends being merely a service; it represents a dedication to reshaping car ownership for a more sustainable tomorrow.

Talking about some data insights…

Lynk & Co’s Peer-to-Peer car sharing community is thriving, with lenders earning approx €850,000 in the last 12 months. The program allows subscribers to cover monthly fees through car sharing income. Key statistics include 18,000 car sharing instances, a 136% increase in bookings, and the Netherlands leading in car sharing participation with 22% of owners actively involved. Lenders can set hourly prices, with variations such as 9 €/hour in Sweden and 30 €/hour in Italy.

Other big OEMs hitting P2P ground - Hyundai + Turo use case

Major OEMs initiated the partnership with Peer-to-Peer car sharing companies in recent years. A core example is the automotive giant Hyundai signing a partnership with Turo to allow hosts to easily make their Hyundai vehicles available for rent through the Turo platform.

The collaboration between Hyundai and Turo wants to unlock an extreme potential into the Peer-to-Peer industry, with the aim to innovate even more the car sharing experience. This collaboration plans to inject a fleet of premium Hyundai vehicles within the Turo marketplace, accompanied by substantial incentives for prospective hosts, totaling up to $5400.

Accelerating presence

As the Peer-to-Peer car sharing market continues its rapid growth trajectory, emerging OEMs are seizing the opportunity to diversify their business models and tap into this trending sector. By expanding beyond traditional car sales and embracing services like car sharing, OEMs are not only broadening their revenue streams but also enhancing customer engagement and brand visibility. With a focus on innovation, sustainability, and meeting evolving consumer demands, OEMs are poised to play a pivotal role in shaping the future of mobility.

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About the author

Benedetta Biggi

Digital Content and PR Specialist at 2hire

I love running and daydreaming losing count of the distance I’m covering, cooking (and especially eating) and Drake is my spirit guide.