DriveNow Belgium is losing more money than planned
BMW’s free-floating car sharing company, DriveNow, has recorded a loss of 3,25 million euro in 2017 in Belgium. According to its CEO, the government’s mobility plan and company cars are to blame.
Back in 2015, BMW and Sixt launched a free-floating car sharing company, called DriveNow, which provides Minis and BMW’s for rent anywhere in the city. Now completely bought back by the Bavarian carmaker, DriveNow is active in many cities in Germany, Austria, United Kingdom, Denmark, Sweden, Italy, Finland, Portugal and Belgium.
Not profitable yet
Since its launch, the figures aren’t great, which could worry some people, especially after other car sharing services, such as the French Autolib’, had to pull the plug. In 2016, DriveNow Belgium recorded a loss of 2,24 million euro and in 2017 it was even worse with minus 3,25 million euro.
“In the original plan, we predicted a loss of 900.000 euro less than in 2017, which represented 2,4 million”, explains DriveNow Belgium CEO, Christian Lambert. The break-even point has been postponed from the end of 2018 to 2020 or 2021.
In terms of costs, DriveNow fares quite well in Brussels compared to other cities. The major problem is growth. “Honestly, it’s mainly the company cars that block DriveNow’s growth”, adds the CEO. Indeed, in sectors where employees don’t have company cars, DriveNow’s penetration rate is superior.
Mobility Budget: failing promises
“Have you read the text?”, adds Christian Lambert. “Train tickets are part of the Mobility Budget but only if they’re used to go to work. It’s a restriction that doesn’t apply to the company car.” Shared cars are also part of the Mobility Budget, but if they are treated the same way as train tickets the positive effect will be reduced.
DriveNow’s CEO pleads for the Mobility Budget to take the shared car usage as a whole, even when the employee uses it to go shopping. “If we want to succeed, other means of transports have to be totally included in this mobility budget”, continues Mr Lambert.
Just as Daimler or PSA, BMW knows that in the future it will sell mobility and not just cars. “We already have more than 26.000 recorded users, but with 60.000 clients doing four trips per month, we can reach break-even”, ends the CEO. As a reminder, DriveNow offers shared cars for rent in the free-floating system. Contrary to other companies, like Cambio or Ubeeqo, DriveNow’s cars don’t need docking stations and can be picked up and dropped off anywhere in the city.