Car Sharing (Time-Share Car Rental)

1. Definition and Positioning

Car sharing (time-share rental) refers to a short-term rental service for small and compact passenger cars charged on a per-minute or hourly basis. By leveraging mobile internet and GPS technologies, operators provide an app-based platform enabling self-service vehicle reservation, collection, return, and automated payment settlement. Its hallmark feature is the granular breakdown of vehicle usage rights by time, allowing users to handle the entire journey—searching, booking, unlocking, and paying—via a smartphone app without the financial burden of vehicle ownership and ongoing maintenance.

2. Operating Models and Service Formats

Car sharing operations primarily feature three vehicle collection and return models:

Fleets are predominantly comprised of new energy vehicles (NEVs), accounting for over 95% of the industry. Pricing structures generally combine "duration + mileage", with select operators offering daily capped rates, while tariffs vary according to vehicle models and operating hours.

3. Policy Landscape and Development Timeline

Car sharing first entered the Chinese market in 2011, before scaling up rapidly from 2015 alongside the rise of the sharing economy. In 2017, the Ministry of Transport and the Ministry of Housing and Urban-Rural Development issued joint guidelines encouraging the adoption of new energy vehicles in car sharing, officially integrating it into the regulatory framework for small and compact passenger car rentals. In 2020, a joint directive by 12 government ministries formally designated car sharing as one of seven key application scenarios for accelerating NEV adoption.

4. Industry Characteristics and Key Challenges

The car sharing industry exhibits several defining characteristics:

• Asset-heavy operations: With a per-unit acquisition cost of around RM80,000 to RM120,000, initial capital expenditure is substantially higher than micro-mobility options like bike sharing.

• High operating expenditure (OpEx): Running costs comprise vehicle procurement and motor insurance, fleet rebalancing and valeting, alongside parking bay rentals and EV charging, resulting in high fixed overheads.

• Profitability hurdles: The industry average fleet utilisation rate hovers at around 12% per vehicle daily, falling well short of the break-even threshold (typically requiring 6 to 8 trips per day). Globally, aside from rare exceptions, most car-sharing operators remain persistently in the red.

• Heavy infrastructure dependency: Service coverage and customer experience hinge directly on public infrastructure, including dedicated bay availability, parking facilities, and EV charging networks. Early phases were plagued by pain points such as insufficient drop-off points, limited charging amenities, and inconsistent vehicle hygiene.

5. Future Outlook and Industry Trends

• Market consolidation: Following the initial boom, many small and medium-sized operators exited due to poor cost controls, leading to market consolidation dominated by well-funded players with strong resource backings.

• Shift from asset-heavy to tech-driven solutions: Select platforms are downsizing self-operated fleets to pivot towards asset-light models, offering software and hardware platforms as well as turnkey fleet management solutions to OEMs.

• Integration into smart mobility ecosystems: Serving as a feeder to comprehensive urban transit networks, car sharing is increasingly integrated into Mobility-as-a-Service (MaaS) ecosystems, enabling seamless multimodal journeys alongside public transport and e-hailing services.