Business / Auto China

Car sharing on the road to China

By Li Fangfang (China Daily) Updated: 2014-06-09 07:13

Four steps

Roland Berger's experts proposed four steps to successfully enter the market while reducing market entry risks.

Defining business model

Potential car sharing providers need to account for China's market specifics during the setup of their fleet, as business models established elsewhere are not directly transferable.

Key differences in infrastructure and sprawling urban areas pose challenges for customer accessibility, said the Roland Berger study.

In addition, credit records and commercial insurance policies are limited.

Product offerings

Car sharing providers found it necessary to offer different product packages and flexible pricing options to capture different consumer groups.

Operators who provide vehicles with unique designs and integrate electric or low-emission vehicles into their fleets will be successful in China's car sharing market, according to the Roland Berger study.

In addition customized and easy-to-access services that enrich the consumer experience must be offered to Chinese consumers.

Government lobbying

Lobbying and cooperating with governments at various levels will help car sharing providers in a number of ways. Support from authorities can help reduce approval and licensing times and provide access to a sufficient number of license plates.

In financial terms, governments can offer more favorable taxation policies and lower costs for parking and land.

Pilot cities

Major cities with strong local governmental support and high customer awareness such as Hangzhou, Beijing, and Shenzhen are ideal cities for piloting the car sharing service in China. Pilot cities need to be chosen carefully to minimize market entry risk. Zhang said the battle for the Chinese car sharing market had only just begun and no dominant player has emerged yet, leaving opportunities open for local vehicle manufacturers.

Car sharing on the road to China

Car sharing on the road to China

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