Zipcar - Avis Budget Neighborhood

Zipcar is an American car-sharing company and a subsidiary of Avis Budget Group. Zipcar provides automobile reservations to its members, billable by the hour or day; members pay a monthly or annual membership fee in addition to car reservations charges. Zipcar was founded in 2000 by Antje Danielson and Robin Chase.

On March 14, 2013, Avis Budget Group purchased Zipcar for approximately US$500 million in cash; Zipcar operates as a subsidiary of Avis Budget Group. Scott Griffith, who had run the company for the previous 10 years, resigned the day after the acquisition closed and passed the reins to a new company president, Mark Norman. In early 2014, Kaye Ceille took over as Zipcar's North American President. In the summer of 2016, Kaye Ceille became a managing director of Avis Budget Group International.

As of September 2016, Zipcar has announced that they have 1 million members across the 500 cities and 9 countries they serve, and offers nearly 10,000 vehicles throughout the United States, Austria, Belgium, Canada, France, Germany, Spain, Turkey, and the United Kingdom, making Zipcar one of the world's leading car rental networks.

Members can reserve vehicles with Zipcar's mobile app, online, or by phone at any time, either immediately or up to a year in advance. Zipcar members have automated access to Zipcars using an access card which works with the car's technology to unlock the door; the keys are already located inside. Alternatively, members can use Zipcar's Android or iPhone app to locate a Zipcar by honking its horn as well as to unlock the doors. Zipcar charges a one-time application fee, an annual fee, and a reservation charge. Fuel, parking, insurance, and maintenance are included in the price.

In the third quarter of 2007, Zipcar merged with Seattle-based rival Flexcar to create a nationwide car rental company. The company's IPO was in April 2011. Zipcar common stock traded on NASDAQ under the ticker symbol "ZIP" until it was acquired by Avis in 2013.

History

Zipcar was co-founded by Antje Danielson and Robin Chase based on existing German and Swiss companies in January 2000. In June 2000, the first Zipcars hit the road around Boston, Massachusetts. In January 2001, Antje was fired from Zipcar after Robin Chase petitioned Zipcar’s board for the ability to make hiring and firing decisions without consulting them. In September 2001, the Washington, D.C. office opened, with the branch in New York City following in February 2002. In February 2003, after difficulties in securing additional rounds of funding, the Zipcar board replaced Robin Chase as CEO with Scott Griffith. In July 2005, Zipcar secured $10 million in funding led by Benchmark Capital. In August 2005, San Francisco office opened. In May 2006, the Toronto office opened. In May 2006, General Electric's Commercial Finance Fleet Services (NYSE: GE) gave Zipcar $20 million in lease line financing. In September 2006, Toronto market was named fastest growing new ma rket in company history. In November 2006, London office opened. In April 2007, Vancouver office opened. In October 2007, Zipcar and Flexcar executives announced a merger of the two companies, with the Zipcar brand and headquarters replacing that of Flexcar.

On January 23, 2008, the merged Zipcar/Flexcar canceled service for the Southern California cities of Los Angeles and San Diego without providing advance notice to customers in those areas, although Southern California college operations were left intact. On July 11, 2008, Zipcar announced it doubled membership in past year, including the Flexcar members it acquired, and now had 225,000 members. On August 28, 2008, Rice University announced its introduction into the program in their goal of achieving the lowest possible carbon footprint while providing additional transportation options for employees that carpool. In June 2009, the company announced an iPhone application at the Apple World Wide Developer Conference; the application is capable of honking the horn and unlocking some Zipcars.

Following impressive third-quarter results, previous CEO Scott Griffith announced that 2012 would mark Zipcar's "first full year of profitability on a US GAAP basis". Scott Griffith stepped down on March 15, 2013 following Avis Budget Group's acquisition of Zipcar. Mark Norman remained as President until February 2014, when Avis Budget Group announced that Kaye Ceille was appointed president of Zipcar, and "Mark Norman would step down in order to pursue another career opportunity." In July 2016, Kay Ceille stepped down as president of Zipcar to become the managing director of Avis Budget Group International, Australia. On Jan 5 2017, Zipcar announced that after a 6 month search they appointed Tracey Zhen as its new president. Ms. Zhen came over from TripAdvisor where she had been a vice president and general manager.

Membership

Members are able to view vehicle availability and reserve a self-service car via the internet, Android, and iPhone apps, or by telephone, in increments as short as 30 minutes. Members pay only for time they reserve. Zipcar vehicles report their positions to a control center using in-car technology. In the U.S., each reservation entitles the members up to 180 miles (290 km) for each 24-hour period, while Canadian members receive up to 200 kilometres (120 mi) with each reservation for the first 24 hours, and 15 kilometres (9.3 mi) per each additional hour beyond the initial 24. Individual members can sign up for one of two different plans, the "Occasional Driving Plan" and the "Extra Value Plan". While Zipcar provides value plans its rewards program, rental Penguin has ranked Zipcars last among the other rental car companies reward programs.

Members are given an access card containing a wireless chip that will open the vehicle they have reserved only at the time they have reserved it. The reservation includes vehicle insurance, a gas card for the car, reimbursements for fuel obtained at gas stations that do not accept the included gas card, and up to $15 in reimbursements for typical car maintenance items like car washes and window wiper fluid refills. A member can reserve and use a Zipcar in any Zipcar city.

Fees

Zipcar was sued in 2009 and again in 2011 by customers upset with Zipcar for allegedly charging customers excessive or hidden fees. The suit cited several hidden charges, including a charge to talk to a customer service representative even when customers call to report a problem that cannot be handled through the website or automated phone system, additional fees on top of the cost of a parking ticket even if the ticket was overturned in court, late fees starting at $50, a fee to retrieve items left in cars, and an inactivity fee. According to the complaint, many customers may not even be aware of the charges because Zipcar does not send monthly statements. The lawsuit was dismissed in 2010, after U.S. District Judge Nathaniel M. Gorton found that every penalty except an inactive-user charge is legal. In August 2016, Zipcar agreed to settle a case involving allegations of charging New York consumers illegal damage fees for rental vehicles. According to New York Attorney General Er ic T. Schneiderman, New York State law mandates if rental car companies mean to pursue charges for damages to their vehicles, they must give consumers the opportunity to dispute the complaint. Schneiderman’s office alleges Zipcar failed to follow this requirement. The company sometimes purportedly charged consumers damage fees before notifying them of the charges. As a settlement, Zipcar will refund any damage charges assessed against consumers who disputed their responsibility for the damage. Additionally, the company will pay the Attorney General’s Office $35,000 for fees and costs. In addition, Zipcar is barred from charging customers for damage unless those customers agree they’re liable or the company obtains a legal determinationâ€"for example, from a courtâ€"that the driver is responsible. As of August 2016, Zipcar holds a D- rating with the Better Business Bureau.

University, organization and business partnerships

Zipcar launched its Zipcar for Business program in early 2004 to provide companies with discounts on Monday-Friday driving. Since the launch of the program, Zipcar has signed 10,000 small, medium, and large sized businesses, as companies are increasingly adopting Zipcar's on demand car rental model as a cost-saving alternative for employee travel. Zipcar has partnered with over 300 colleges and universities across North America.

Zipcar fleet

Zipcar offers more than 50 makes and models of vehicles, including Audis, BMWs, Mini Coopers, pickup trucks, Prius Hybrids, and more. Each vehicle has a home location: a reserved parking space located on a street, driveway, or neighborhood parking lot in the member's area, to which it must be returned at the end of the reservation. The locations of all Zipcars and models available at those locations are available at the Zipcar website. Zipcar currently has a fleet of nearly 10,000 vehicles.

Embedded technologies

Zipcars have RFID transponders located on the windshield that communicates with the card to lock and unlock the doors of the vehicle. Each vehicle records hours of usage and mileage, which is uploaded to a central computer via a wireless data link. The location of the vehicles is not tracked during a reservation for privacy reasons but is trackable, and all cars are equipped with a "kill" function that allows the company to prevent the car from starting in the event of theft. (It does not cause the car to turn off, for safety reasons.) Zipcar also offers the embedded Information Technologies it has installed in its fleet as a fleet optimization service through its FastFleet service.

Clean fuel vehicles

Among its fleet of fuel-efficient vehicles, and through an agreement between Honda and Zipcar, the program offers clean fuel and low-emission vehicles that include the Insight hybrid, Civic Hybrid, and Honda Fit EV all-electric car.

Expansion

On October 31, 2007, Zipcar and Flexcar announced their intentions to merge. The merged company retained the name "Zipcar" and was headquartered in Cambridge, Massachusetts. Zipcar's chief executive, former Seattle-based Boeing engineer Scott Griffith, became Chairman and CO, while Flexcar CEO Mark Norman became President and Chief Operating Officer. The merger combined Zipcar's fleet of 3,500 vehicles in 35 markets with Flexcar's 1,500 cars in 15 markets.

In December 2009, Zipcar announced their participation in a round of financing with Avancar, the largest on-demand car rental company in Spain, based in Barcelona. Under the terms of the agreement, Zipcar acquired a minority interest in Avancar, a Zipcar executive joined Avancar's board and Zipcar was given a year option to increase the company's ownership stake. Later on in April 2010, Zipcar announced that it had acquired London-based car-sharing club Streetcar. In December 2010, Zipcar extended their option for another year through the end of 2011, and provided a monetary loan to Avancar, which is convertible into equity if Zipcar chooses to exercise the option. On October 17, 2012, Zipcar announced the completion of its Avancar integration.

In 2014, Zipcar expanded to the Houston and Dallas TX regions. The addition of these new cities marks Zipcar’s availability in 28 major metropolitan markets throughout the United States, Canada, the United Kingdom, Spain and Austria.

In 2014, Zipcar expanded its coverage in Greater Toronto and Hamilton, Ontario in Canada, in partnership with Metrolinx. Zipcar also launched in Paris, France and Madrid, Spain in 2014.

In 2015, Zipcar expanded to Ottawa and Istanbul.

In 2016, Zipcar announced its full launch of its floating car-sharing service in Brussels, Belgium. This launch marks the seventh major country for the brand in Europe and the introduction of its most flexible car-sharing service to date.

Insurance

Zipcar provides liability coverage of $100,000 bodily injury per person, $300,000 bodily injury maximum, $25,000 property damage per accident for members over 21 years of age who joined after March 1, 2015. Members at fault are responsible for the first $1000 of costs related to the repair, recovery, and loss of use of any Zipcar vehicle. However, members can purchase no-liability insurance for an additional $79 a year. Members involved in accidents where fault is not determined (such as in a hit and run) must pay the first $1000 of these costs. For members under 21, Zipcar provides insurance coverage at state-mandated levels.

Zipcar has received some scrutiny for their low coverage limits.

Insurance coverage may vary depending on the region of use. For example, Canadian members in Toronto, Ontario, are provided with $1,000,000 in liability coverage. Vancouver, BC members are provided with $2,000,000 in liability coverage. Both regions in Canada also include comprehensive and collision coverage in addition to liability insurance. Zipcars traveling into Canada from the U.S. require members to obtain a special insurance card from Zipcar. Canadian Zipcars traveling into the U.S. do not need the extra insurance card.

Similar to members of Zipcar U.S., members of Zipcar London, UK, require a special 'vehicle on-hire' certificate when traveling abroad, which can be obtained from Zipcar.