Everything you need to know before starting your car-sharing business
February 23, 2024
min. read
Is it a good time to start a car-sharing business? Absolutely.
The car-sharing market is booming – it's estimated to grow 20% every year and reach a $20 billion market value by 2032. That's nearly a sevenfold increase from 2022's $2.9 billion valuation.
Despite app-based vehicle sharing being a relatively new entrant in the mobility ecosystem, it has exploded in popularity. People have been quick to pick up on its convenience and ease of use, especially in urban centers where maintaining a private vehicle grows increasingly costly and bothersome.
This spells an opportunity for entrepreneurs keen to answer real mobility demand.
But what is car-sharing and how does it work? What does the business model look like? And what are the first steps for getting started?
Find the answers below.
What is car-sharing and how does it work?
Car-sharing is an app-based mobility service that allows individuals to rent vehicles on a short-term basis. With this service, users gain access to a fleet of vehicles which are typically stationed throughout a city, ensuring that there's always a car conveniently nearby.
The user's journey and benefits of car-sharing
Through an app on their smartphone, users can locate, book, and unlock the closest available vehicle, as well as pay for their journey automatically by adding payment details, thus providing a seamless experience and quick access to a car. Other common benefits for users include not having to worry about fuel or insurance, as those are included in the price.
Cities often encourage the use of shared mobility since it helps decongest streets, free up parking, and minimize the environmental impact of private vehicles on the city. Accordingly, public-private partnerships are common, conferring further benefits for users of this type of shared mobility: free parking, free use of bus lanes, and more.
How does car-sharing work: the business perspective
On the business side of things, the operator is responsible for ensuring that maintenance and logistical tasks for their fleet are taken care of.
This includes regular maintenance tasks, such as vehicle check-ups, repairs, fuel fill-ups, and cleaning. Also, if you have a free-floating model (where users can leave their cars anywhere), the operator should regularly relocate cars to optimal locations for continued user convenience and reliability.
Beyond deploying and maintaining their fleet, operators also oversee the smooth functioning of their mobility app, as well as take care of user verification, namely, ensuring that the people signing up are who they say they are and have valid driver licenses. Of course, like any other business, customer support and other responsibilities tied to running the operation are a given.
The car-sharing business model
So far, we have listed a lot of expenses – maintenance, management, insurance, IT. Add to this salaries, operational overheads, and buying or renting the fleet itself. How do businesses recoup all these expenses and turn a profit?
Note: Since car-sharing businesses operate at scale, they should aim to negotiate lower rates with service providers.
Car-sharing businesses make use of several revenue sources. First and foremost, customers are charged for the time/distance use of the car. Additionally, branding and cross-promotion partnerships (e.g. advertising on the car or the app) are often used to secure additional revenue. It may also be sensible to create membership or loyalty programs to ensure recurring revenue, by offering subscribers added benefits, such as access to premium cars or longer reservation times.
The aim is to have your cars on the road as much as possible, so enterprises typically focus on maximizing vehicle usage and revenue per vehicle. Finding success is about finding balance in a constantly changing landscape – having too few cars may lead to overbooking and dissatisfaction with lack of availability, whereas having too many will lead to inefficient use of resources.
How to start a car-sharing business
As with any business, launching a car-sharing project requires research, investment, development, and strategy. Let's take a look at each in turn.
1. Market research
When exploring opportunities for starting a car-sharing business, numerous factors must be considered.
Audience and demand
Understanding the demographics, preferences, and behaviors of your potential users is crucial. As is determining the level of demand. Some questions you should answer include:
- Who is my target audience – urban commuters, occasional travelers?
- What are their demographics? How should you communicate with them?
- What segment offers the most promise – B2C, B2B?
Competition
Identifying who's already operating in your area and why (or why not) can help you get a better grasp of what works and what doesn't. Some questions you should answer include:
- Who are my competitors – other car/ride-sharing businesses, public transportation?
- How can I differentiate my business from others?
- Has any previous similar business failed in this area – why?
Legal and logistical considerations
Determining whether there are any legal/practical barriers to launching your operations is a smart thing to do before you invest too much time and money into your project. Consider:
- What are the legal requirements for operating this type of business in your area?
- How will you handle insurance and liability issues for your fleet?
- How and where will you run your day-to-day operations? If you're thinking about going electric – does the area have the necessary infrastructure?
While answering these questions isn't necessarily a prerequisite for launching your business, dealing with them early on can save you a lot of headaches down the road.
2. Investment
How much capital do you need to launch a car-sharing business?
It depends most on whether you're planning to rent or buy vehicles for your fleet. While renting is more accessible in the short term, it will take a sizable bite out of your profit. Owning your vehicles is typically the preferred option, as this offers price stability, long-term cost efficiency, freedom of operations, and other benefits.
To get a ballpark estimate for the starting investment, you should add up the total price of cars (EUR 12,000-20,000 per vehicle), insurance, car-sharing software procurement and maintenance, as well as expected operational overhead for getting started. It may also be wise to put aside some funds for unexpected expenses such as repairs.
3. Development and launch strategy
Securing the vehicles and necessary permits can take a while, and you should account for this. During this time, you should put your plans into practice. Establish maintenance protocols and logistical plans for efficient fleet management. Implement user verification processes and responsive customer support for a secure and positive user experience.
As to the IT infrastructure, you can save a lot of resources by choosing a white-label IT solution to power your app and dramatically accelerate your time-to-market. Platforms like ATOM Mobility can equip your business with the app you need – all you have to do is customize it.
Speaking of customization, don't forget about branding. Create a compelling brand identity and plan for targeted launch and marketing campaigns to generate awareness the moment your business is ready for its first customers.
Your car-sharing business journey starts here
Now you know how to start a business in this industry – entering this thriving market demands a blend of user-centric strategies and astute business decisions. But the key to success is reliable partners that can guide you in the right direction. Try out our free floating carsharing software and get on the road today!
Get in touch with ATOM Mobility to discover how you can power your new enterprise the smart way.
Interested in launching your own mobility platform?
Click below to learn more or request a demo.
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How to find your niche in the competitive ride-hail market: real-world examples of businesses that resonate
💡Want to break into the ride-hail market but don know what’s your angle and how to make yourself visible in an already packed field? Check out how InDrive, BLACWOLF, and COMIN found their unique angles to thrive in a competitive space! 🚗
December 18, 2024
min. read
The ride-hail market is crowded, fiercely competitive, and often dominated by household names like Uber and Bolt. But don’t let the giants fool you into thinking there’s no place for you. With some creative thinking and a unique angle, you can get on the road quite quickly. The secret? Finding the one thing that sets you apart from others. Let’s explore how some notable players (both veterans and newcomers) have done just that.
InDrive: A pioneer in price negotiation
🔹 Over 200M downloads, active in 700+ cities across 45+ countries
🔹 Unique feature: Set your price - Riders offer a fare, and drivers can accept or negotiate!
🔹 Drivers pay no commission, just a small monthly subscription, giving them better earnings.
🔹 Unique market entry: Initially free usage for drivers (no commission, no subscription).
Before we discuss the latest players, let’s revisit InDrive, a company that entered the market years ago with an approach that sounds almost too simple to work – offer your price.
The idea is straightforward. Instead of accepting a fixed fare, riders suggest how much they’re willing to pay. Drivers, in turn, can accept, counter, or reject the offer. It’s a dynamic that mirrors haggling at a bazaar but digitized for the modern commuter.
This model resonated. Riders felt empowered, and drivers appreciated the flexibility, especially in sensitive markets where fair pricing is a concern. InDrive rapidly scaled across emerging markets like Latin America, Russia, and Southeast Asia, regions where affordability and negotiation are cultural norms.
The takeaway here? InDrive’s “offer your price” model wasn’t just a fun gimmick, but a solution tailored to specific markets and demographics, offering fair rides to anyone who needs it. If you’re entering the ride-hail space, ask yourself: what unique cultural or social nuance can you leverage to disrupt the market in the region?
BLACWOLF: The armed and ready approach
🔹 Unique feature: Focus on rider security with armed & trained drivers 🛡️
🔹 Launched in Atlanta (2023), now expanding across Arizona, Florida, Georgia, Tennessee, and soon Houston, Austin, and Dallas!
🔹 Over 300K downloads in just 1.5 years.
Now, let’s fast-forward to the present and head to the U.S., where BLACWOLF has entered the scene (launched in Atlanta, 2023), now expanding across Arizona, Florida, Georgia, Tennessee, and soon Houston, Austin, and Dallaswith an eyebrow-raising twist: drivers who carry firearms.
BLACWOLF was launched in response to concerns over driver and passenger safety. Their USP (unique selling proposition) is ensuring peace of mind through armed drivers. As their slogan says, “We didn't reinvent ride-hailing; we just made it safer.”
As controversial as it sounds, it’s resonating in specific markets like Houston, where personal security is a priority for many.
This approach has gained traction, especially among passengers who prioritize safety or feel underserved by existing ride-hail platforms. Of course, it’s not without its challenges. Regulatory hurdles and liability concerns spring to mind; however, BLACWOLF is scaling rapidly, proving that a polarizing angle can still be a winning one.
Don’t shy away from bold ideas that cater to real pain points. Whether it’s safety, convenience, or cost, identifying an underserved need can help you stand out in a crowded market.
COMIN: France’s bid-for-ride disruptor
🔹 Unique features: Offering a fair 10% commission and Set your price feature (similar to inDrive).
🔹 Quickly onboarded 6,000 drivers, capturing 15% of the market in record time.
Over in Europe, a fresh player called COMIN is shaking things up in France. This newcomer has onboarded 6,000 drivers, taking 15% of the French market almost overnight, a feat that’s turning heads across the industry.
COMIN’s secret sauce? A bidding system that allows passengers to submit offers for rides, giving drivers the choice to accept or negotiate. Yes, it’s like InDrive, but with a hyper-local twist tailored to France’s market dynamics.
To fuel their growth, they’ve also raised €300,000 in seed funding from Station F, Europe’s largest startup incubator. By focusing on one market and perfecting their model, COMIN has avoided doing too much at once—proof that a focused approach often trumps trying to be everything to everyone.
For aspiring ride-hail entrepreneurs, COMIN serves as a case study in starting small but thinking big. Specializing in one region or demographic before expanding can help you gain traction and refine your offering.
The ride-hail market may look like a fortress, but even the strongest walls have cracks. With creativity, boldness, and the right platform to support your vision, there’s no reason you can’t break through and thrive. Are you ready?
How ATOM Mobility can help
So, you’ve got your groundbreaking idea. What’s next? To turn your vision into a reality, you’ll need a robust platform to build on—and that’s where ATOM Mobility comes in.
ATOM provides a ready-made platform for entrepreneurs looking to launch ride-hailing or mobility services. With customizable tools, seamless integrations, and scalable tech, ATOM lets you focus on your unique value proposition while we handle the backend.
Ready to make your mark in the ride-hail world? Join ATOM Mobility today and start your journey!
Blog
Cracking the code of car sharing: Best technology for car sharing business
🚘💡 What keeps cars in car-sharing businesses connected? From CAN bus and OBD devices to cutting-edge IoT providers like Teltonika, Invers and Geotab, it’s all about the hardware!
November 27, 2024
min. read
Car sharing is more than just a trend—it’s a game-changer for urban mobility, helping people access vehicles without the headache of owning them. But what makes it all work? Let us introduce the tech behind car sharing and explore how companies like ATOM Mobility make it easier to start and scale your shared mobility business profitably.
The three pillars of car sharing technology
At the heart of every car-sharing operation are three key technologies that connect vehicles to platforms: CAN bus, OBD, and OEM telematics. Here’s what they do and why they matter:
1. CAN Bus: The car’s internal network
The Controller Area Network (CAN) bus acts like a car’s central nervous system, allowing different components to talk to each other. It delivers detailed data—fuel levels, battery status, or even tire pressure—directly to your car-sharing platform. This deep integration also allows remote actions like locking or starting the vehicle.
However, CAN systems require professional installation, which can mean higher upfront costs. For larger operators with fleets that need granular control and detailed diagnostics, it’s a must-have.
2. OBD: Affordable and easy to deploy
On-Board Diagnostics (OBD) devices are the plug-and-play heroes of car sharing. Simply connect them to the car’s diagnostic port, and you’ve got instant access to location, speed, and engine health. They’re affordable, quick to set up, and ideal for small-to-medium operators just getting started.
That said, OBD devices offer less functionality compared to CAN. They’re perfect for a more basic setup but might not suit operators who need advanced data or remote vehicle controls.
3. OEM Telematics: Factory-installed genius
OEM telematics systems come pre-installed in many modern cars. These systems provide seamless connectivity and are highly reliable, enabling features like real-time tracking, diagnostics, and remote locking.
The downside? OEM telematics tie you to the car manufacturer’s system, which can limit customization. If your fleet is from a single brand, this is a fantastic option. For mixed-brand fleets, integrating other devices might make more sense.
The IoT providers helping you succeed
Beyond these three core technologies, IoT providers offer additional tools to supercharge your car-sharing operations. Here are four standout names making waves in the industry:
Teltonika
WEB: https://teltonika-gps.com
Headquartered in Lithuania, Teltonika has been at the forefront of IoT since 1998. With over 1,600 employees, the company specializes in GPS trackers and other connected devices that bring real-time tracking, security, and driver behavior analysis to your fleet. Their scalable solutions are ideal for growing car-sharing businesses.
Geotab
WEB: https://www.geotab.com
Based in Canada, Geotab supports over 2 million vehicles worldwide with its advanced fleet management tools. Their telematics devices don’t just track vehicles—they provide insights into fuel efficiency, maintenance needs, and safety. For operators focused on data-driven optimization, Geotab is a top choice.
INVERS
WEB: https://invers.com/en/solutions/cloudboxx
Germany’s INVERS is a leader in shared mobility tech, offering the CloudBoxx device to connect vehicles with car-sharing platforms. Easy to integrate and reliable, CloudBoxx ensures a smooth experience for operators and users alike. With a strong presence in Europe and North America, INVERS is a trusted name in the industry.
Acacus
WEB: https://www.acacusgroup.com
Operating out of the UAE, Acacus combines IoT and AI to deliver smart mobility solutions. Their tech is widely used in government projects and private fleets, especially in regions embracing smart cities. Acacus brings innovation and reliability to shared mobility operators aiming for cutting-edge solutions.
How ATOM Mobility comes into the picture?
Technology is only as good as the platform that connects it all. That’s where ATOM Mobility shines.
ATOM’s software integrates seamlessly with devices from Teltonika, Geotab, INVERS, and others, making it simple to connect your fleet and manage everything from a single dashboard. No matter the size of your operation, ATOM provides tools for real-time tracking, user management, and secure payments—all with intuitive design and full support.
Whether you’re launching your first car-sharing fleet or expanding across multiple cities, ATOM helps you scale profitably and with confidence. We make the technical stuff easy so you can focus on growing your business.
Why is car sharing the future?
Urban living is changing. People are moving away from car ownership, opting instead for flexible, on-demand solutions like car sharing. It’s convenient, cost-effective, and kinder to the planet.
With tech like CAN, OBD, OEM telematics, and IoT devices driving the industry forward, the potential for shared mobility is enormous. But to succeed, operators need the right tools to manage fleets, optimize performance, and deliver a great user experience.
Join us
Ready to start your car-sharing journey? Book a demo with ATOM Mobility and let’s get moving!
Driver App demo credentials - Email: test@atom.com, Password: driver
