January 13, 2013

Deal by Avis adds to Zipcar's ascent

The ability to access a car quickly and give it back after a few hours is exploding in popularity among college students and city dwellers.

The ability to access a car quickly and give it back after a few hours is exploding in popularity among college students and city dwellers.

Zipcar created the car-sharing concept in 2000. By the end of the decade, car-sharing had caught the attention of the nation's two largest U.S. car-rental companies as Enterprise and Hertz started competing services. And earlier this month, Avis, the No. 3 car-rental company, jumped in by offering nearly $500 million to buy Zipcar.

While car-sharing is a popular alternative for those who rely on public transit or live on walking-friendly college campuses, it's not feasible in less-populated areas. Several are available in Sacramento, mostly in midtown, and about a dozen in Davis.

Traditional car-rental companies still dominate at airports, catering to travelers that need a car while on business or vacation.

Here's a look at how Zipcar works, for whom it works best and what it can cost.

How it works

Zipcar says it caters to younger, more tech-savvy customers who want a simplified car-borrowing experience.

Car-sharing is far quicker than a traditional rental, in which you'll go to a counter and stand in line to wait for a car. And Zipcar has a fleet of small trucks that are useful for local moves.

With Zipcar and its car-sharing brethren, customers leave a car in a city parking lot, garage or in an assigned parking space on a college campus. "Zipsters," as Zipcar calls its customers, then find the car with the name tag that matches their reservation. Viewing the make and model on the company's smartphone app allows for easier spotting.

The car is locked and unlocked with a membership "Zipcard." The keys are stashed in the car.

Zipcars aren't often checked for cleanliness or gas in between renters (they ask that you keep a quarter-tank at all times.) That can be a downside compared with standard car rentals.

Zipcar customers fuel up using a gas card that's stored in each car. With a traditional rental, customers fill up as if it's their own car and are expected to return the car full or face a hefty per-gallon charge.

To return the car, bring it back to a marked parking space and swipe the Zipcard on the windshield. That stops your rental clock and tells the company you returned the car on time.

What it costs

To join Zipcar, members pay a $25 application fee and $50 a year. Rates run from $7.50 an hour and include gas, insurance and mileage beyond 180 miles a day.

By comparison, Hertz on Demand Standard car rental prices vary widely but generally range between $50 and $100 per day in big cities.

Pros and cons

You're generally not charged for mileage if you're renting from Hertz or Avis. "Zipsters" have to pay for any trip longer than 180 miles. For a long weekend trip, a Zipcar might not be your best bet.

You only have to be 21 years old to rent a Zipcar, or 18 if you're renting it from a university campus and have a clean driving record. Most renters have to be 25 to rent through a traditional company. Sometimes, younger drivers can rent for an extra per-day fee.

Once you go beyond 24 hours, car-sharing is generally more expensive than a standard rental.

Zipcar is far larger than competitors Hertz and Enterprise, but you can link your rewards memberships through those companies and earn points for rentals.

Where to find it

The car-sharing model makes the most sense in populated areas. The number of Zipcar locations will grow when the Avis deal is complete.

Zipcar has more than 760,000 members, triple what it had in 2008. It has 10,000 vehicles in the U.S., U.K., Spain and Austria.

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