What can councils do to support car clubs?
There are a number of ways councils can support and promote car clubs. As demonstrated in the previous section, there are an array of benefits that car clubs can provide to councils. However, there are several considerations that a council needs to understand to support car club deployment and ensure successful implementation.
Supporting infrastructure – parking
Car clubs cannot operate without appropriate parking provision, be that dedicated bays or on-street parking permits. Councils, therefore, have an integral role to play in providing car clubs with access to parking bays and issuing parking permits. For car clubs which will operate from a fixed, dedicated parking bay (one-way, back-to-bay models), traffic regulation orders (TROs) will need to be amended to re-designate bays for exclusive car club use which includes the provision of a sign and lines to mark out the bay.
Supporting infrastructure – EV charging
EV car clubs need access to EV charging points. The provision of EV charging points depends on the car club operating model. For back-to-bay or back-to-area, it could involve chargers dedicated to car club use, either on-street or in a car park, facilitated by a TRO. Double headed charging points could be used to serve both an EV car club vehicle and publicly accessible vehicle in a twin bay.
Currently for one-way/flex car clubs the operators typically manage the charging process for EV vehicles. If the density of charging stations could measurably increase, the charging needs of both users and operators could be further supported and allow more EV car club vehicles to be introduced. For the one way / flex model for example, operators will need to supplement user charging and thus rapid chargers and/or dedicated fast chargers is important. Currently, charging can involve dead mileage to access charge points and thus a greater density of charging stations is important to reduce this element but also to not discriminate against the cleanest form of car use (shared). Additionally, as previously mentioned, car clubs provide access to EVs at a small fraction of the cost of owning/leasing and thus there is an equity element to providing adequate EV charging infrastructure. Given the strong decarbonisation delivery of car clubs, it is important infrastructure policy and practice should go further.
Parking permits
Councils need to consider their parking permit policy for car clubs as part of their wider parking permit policy. Councils may impose car parking charges as per their statutory powers deriving from the Road Traffic Regulation Act (RTRA) 1984. However, the RTRA does not authorise the Council to use its powers to charge local residents increased parking charges with the purpose of raising surplus revenue for other transport purposes. Councils should be cognisant of the RTRA limitations when considering their permit approach for car club operators. Given the benefits that car clubs can provide, there is an argument that councils should remove or reduce parking permit fees associated with car clubs (both the application and the annual fee). Councils should seek to ensure any permit pricing policy does not deter operators from entering the market. Councils could adopt a more flexible approach with permits to promote a more equitable car club provision. For example, to encourage growth out of more profitable areas, permit fees could be graded with the location (i.e. cheaper permit for less profitable areas). Alternatively, permits could be granted in pairs with the higher value permit only awarded with commitment to implementing a car club in areas with greater social benefits, but expected lower levels of initial demand.
In context of the climate crisis and considering there are approximately 5,000 car club vehicles vs 32 million private cars in the UK, it is important to look at parking policies more holistically and how private cars are being charged vs shared ones.
For one way / flex car club models, councils should seek to offer a corresponding flexible parking permit for purchase by car club operators. This permit can allow the flexible car club vehicle to park in any on-street marked bay (excluding disabled bays).
Examples of permissive approaches to parking permits with car clubs include Brighton where car club parking permit fees are significantly reduced. In the London Borough of Lewisham, a ‘floating’ car club permit was introduced to allow a set number of car club vehicles to park in controlled spaces across the borough. These permits allow car club vehicles to be parked in the borough with a maximum number assigned to the operator. This is just one example of a much more widespread trend.
Procurement
There are several factors for councils to consider when procuring a car club operator(s). CoMoUK have developed guidance on car club procurement which is particularly helpful in this regard. Firstly, a procurement model should be selected. Whilst councils should seek their own legal advice when directly procuring services or entering into any partnerships, the main procurement models include:
- Concession model: whereby councils invite a car club operator to serve their area without funding the scheme. In this model, the car club operator generates income from customer revenue rather than any funding or fee from the council. The operator has flexibility in the operational decisions as it bears the financial risk. This approach would likely involve a request for proposal (RFP) to be issued by the council.
- Traditional services arrangement: the operator will charge the council for providing the scheme (typically including a level of car club usage for council staff) and has more certainty over payment. This approach may be adopted whereby there are more ambitious plans with coverage, a higher percentage of EVs are expected or a specified service is required. This approach would typically involve a full tender process under a public contracts regulation (PCR).
For both procurement approaches, the contract length is ultimately within the councils’ control. However, in the UK to date, typical contracts are three years, often with one plus year type extensions. Awarding contracts for much longer than three years is not typically recommended given the car club market evolves more quickly than some other transport markets.
For each procurement model, there are a number of considerations that councils will need to consider for inclusion in their RFPs or tenders including but not limited to:
- Type of a car club model: this is arguably the most important aspect to consider as this has an impact on other decisions such as parking provision, permit consideration, area size and overall customer satisfaction.
- Location of bays/area of operation: depending on the model, councils need to decide the operating area that should apply for car clubs. For example, for back-to-bay, councils will need to work closely with operators to define bay locations. Whereas with one-way / flex models, councils will need to define the operational zone and any locations where parking is not permitted (e.g. busy high-streets).
- Accredited car club operators: councils should include accreditation as a requirement for a successful bidder. CoMoUK offer an accreditation scheme which provides clarity and reassurance via an agreed set of standards. The accreditation aims to reduce repetition of work for both councils and operators and boosts confidence in the sector.
- Parking permit approach: councils need to consider their overall approach to car club parking permits in context of their overall parking permit approach. It is important councils price their permits accordingly so that their area is attractive for prospective operators recognising the potential benefits car clubs can provide. Introducing a low-cost permit is likely to be a better approach to encourage operators to come to market and ensure schemes are commercially viable. In addition to the pricing of permits, permits may need to be adapted according to the different car club model. For example, a permit for a designated parking place (used for back-to-bay model), one that applies to a street or two (back-to-area) or a wider area where vehicles can be parked in multiple locations (one way / flex).
- Number of operators: the scale and type of car club scheme are important factors to consider with regards to the number of operators. Introducing more than one operator can ensure standards and performance remains high with competition driving quality and innovation and increased investment to develop the network. In larger more densely populated areas, there may be sufficient demand to justify more than one operator. Whilst an additional provider can offer users with a wider choice and potentially differing models, there are downsides such as creating a confusing customer proposition with multiple brands, additional registration requirements, additional membership costs and potentially different booking processes required per operator (e.g. different phone apps).
- Alignment with EV procurement: if a council is separately considering introducing EV charging points, there should be consideration of how this aligns with car club parking bays. Similarly, for any new development, EV charging points coupled with a car club bay should be encouraged. CoMoUK have developed guidance for introducing EVs in car club schemes to help in this regard.
- Data sharing: councils may wish to include requirements on data reporting in their procurement specification. Due to the on-board vehicle telematics and booking process, car club vehicles generate detailed and potentially highly useful data on journey patterns. The capacity of transport officers to make use of this data should be considered in any data specifications.
Local Context - introducing car clubs in rural areas
Local context is important when considering which model is more appropriate for a particular area. In more rural areas, with lower population density and, therefore, likely lower demand, consideration of the commercial viability of a car club scheme is important. The formal tender approach, with council support, may be more viable in order to attract an operator to the area as a concession model may not be financially sustainable.
In rural or more dispersed areas, a community or peer-to-peer model car club may also be a more suitable option, particularly from an economic perspective. A council can help to set up and promote a community or peer-to-peer car club. Placing vehicles at community hubs, such as village halls, is also likely to encourage take up. CoMoUK have developed useful guidance for community car club sharing.
Derwent Valley Car Club in Gateshead is an example of a rural car club. It was set up in 2013 with support from a National Lottery grant. The vehicle is based at the community centre and is coupled with an electric charging point. The grant also provided funding for solar panels which offset much of the electrical charging need to run the vehicle, making the scheme emission free.
An alternative option introduced in Oxford, is the use of a closed loop peer-to-peer service. In September 2021, a trial was facilitated by Hiyacar and the Oxford-based neighbourhood car sharing group, ShareOurCars. The scheme ensures that those who wish to share or borrow cars on their street, are able to share their cars only between themselves, through a closed loop. Only those that are a part of the trial can search for and book the cars available in their loop, through the Hiyacar app. This is just another example of adapting a car club model to meet local needs.
Marketing & public awareness
Whilst the number of car club vehicles and members in the UK has been growing in the past five years, it is still a relatively new concept for many people. It is, therefore, important that both car club operators and councils promote the service to ensure its uptake and benefits are optimised. Awareness can also be achieved through the physical infrastructure itself, for example, ensuring the car club bays and vehicles are distinctive and clearly marked. The parking permit renewal process can also be a good opportunity to advertise car clubs. Mobility Hubs can also increase visibility and raise awareness of car clubs.
Mobility Hubs:
In Bremen, Germany, their network of Mobility Hubs which include car club vehicles (10 large Mobility Hubs and 33 small Mobility Hubs) has had several benefits for the city. Whilst there are a package of measures that have led to its success, specifically for car clubs, the result of the Mobility Hubs includes the kilometres travelled by car in a ‘carsharing household’ are more than 50 per cent lower than the average household in Bremen, whilst a study in 2018 shows that on average each car club car in Bremen has replaced 16 private cars.
Stakeholder engagement
There are several stakeholders and decision makers that are involved in development of a car club scheme. This can range from elected members through to various council teams such as procurement, sustainable transport, press office and parking. It is important that all teams are kept informed and engaged for relevant decision-making milestones.
Funding
There is no central government fund dedicated to supporting car clubs in England or Wales. However, there are various funding options that can be explored to support roll-out of a car club scheme including:
- Privately funded: a car club operator funds the entire scheme, which is typically achieved via a concession model although with this option this may limit the provision.
- Developer contributions: this is whereby councils leverage funding through Section 106 or Community Infrastructure Levy (CIL) to provide a dedicated pot of money towards car clubs. Some examples are provided later on in this report.
- Council supported: councils can support car club schemes by replacing their own pool car fleet or “grey” vehicles (i.e. private vehicles staff use for council related journeys) with car club vehicles. This can provide a minimum level of demand for car club operators and when the vehicles are not used by the Council staff, they can be offered up to the public. For commercial car club viability, utilisation of the vehicle is important. Where residential demand is lower, this can be supported by business use and also local authority use. In some locations the launch of a car club has been enabled by the ‘block booking’ of certain cars for council use to replace pool cars, or use of private cars for council business. For example, North Ayrshire Council previously incorporated Enterprise car club vehicles into its fleet and as a result cut grey fleet CO₂ emissions by 37 per cent within 18 months. It is worth noting that whilst there is a tax relief available on company cars and company bicycles, there is no tax relief for joining a car club. The CoMoUK employer action kit can help councils in this context.
- Community based car clubs: as trailed in the introduction, this is where a car club scheme is typically funded by a grant making body with running costs supported by volunteers and joint ventures.
- Parking permits: can provide some revenue, but caution should be applied in considering to significantly increase this beyond residential parking bays so as not to deter operators from coming to market. From an environmental perspective, there is an argument that permits for car clubs should be lower than private car permits.
There are also alternative community owned funding solutions which can be used:
- Community Interest Companies (CIC) exist to benefit the community rather than private shareholders. CICs can raise investment from a range of sources including shares but there is a cap on the return on investment. For example, a car club operator Co-Wheels is set up as a CIC.
- There are car club operators in the UK that are set up as a Community Benefit Society (CBS), such as the operator co-cars. A CBS is set up to conduct business for the benefit of their community. Profits are not distributed among members, or external shareholders, but returned to the community. A CBS can raise finance using a range of sources including community shares at all stages (this is the model that co-cars use).
Developer contributions
For new housing developments, Section 106/Section 75 is a lever that councils can explore by requiring developers to establish a car club as a direct contribution towards set up or operating costs (Note: Section 106 applies to England and Wales, Section 75 to Scotland). For example, the London Borough of Lambeth include a provision for sustainable transport infrastructure in their S106 planning document should any new development generate new transport demand. This document by Lambeth specifically recommends car clubs as one mitigation to achieve this. For major developments, developers are expected to provide free or subsidised memberships for a significant portion of the residential units in addition to parking bays on-site and/or a payments made to the council to provide on-street parking bays for car clubs. Similarly, Leeds City Council developed supplementary planning guidance which requires developers to fund memberships for car clubs at new developments. In the Leodis Square development, this policy has been implemented which has seen 61 residents join the car club scheme. This is particularly important as this development has a ratio of 0.3 spaces per unit.
A couple of recent examples of using S106 include:
- London Borough of Haringey: New River Village, Enterprise Car Club has introduced three cars via S106 funding as part of the development.
- Tunbridge Wells/Kent County Council: Two car club vehicles introduced in 2014 as a pilot with S106 funding (along with operator funding and financial support from Kent County Council). Initial success led to the scheme expanding to five vehicles. There is a current request to expand the scheme with additional S106 support.
In Scotland, developer contributions are also used to help fund car club schemes, for example:
- Aberdeen City Council have developed a mechanism for car club contributions to be used as part of the “Planning Obligations” and “Transport and Accessibility” supplementary guidance to its 2017 Local Development Plan. Their policy makes explicitly calls out the need for car club provision: “To continue to facilitate and promote the car club in order to provide transport choice without necessitating individual car ownership.” Since 2017, £266,000 has been paid to the car club from 42 planning applications. This has funded eight cars and several memberships. In the future they hope the refreshed planning guidance in 2022 will ensure that car clubs are automatically included within developments rather than only in scenarios with parking shortfalls.
CoMoUK have developed guidance for new developments and cutting car dependency which can help councils in this regard.