Why Is a Luxury Automaker in the Car-sharing Business?

Insights from a BMW-sponsored Dialogue about the Future of Transportation

May 16, 2016

Principal, NBBJ

Editor’s Note: This is the first post in a four-part series about the impact of driverless cars on design and planning. On Tuesday, Donald Bellefeuille wrote about the health opportunities afforded by autonomous vehicles; on Wednesday, architects and planners from NBBJ shared some surprising impacts on a wide variety of topics. On Thursday, Alex Krieger looked at the potential downside of increased congestion.


I recently attended one of three “community dialogues” convened by BMW Group in Boston. (Madrid and Tokyo are on the list as well.) As a manufacturer of premium performance automobiles, one can imagine that BMW is keen to understand the future of engine technology and autonomous transportation, and now it seems they are especially interested in cities.

BMW markets to strivers of all stripes: successful entrepreneurs, business people and those who wish to make a statement about their success. Unfortunately, this market niche is increasingly giving up cars altogether as they move into expensive and dense urban centers that feature mature public transit systems, ubiquitous Uber access and car-sharing opportunities. Why buy a car (much less a BMW) when your status is linked more directly to your cell phone or your international travel itinerary? This is BMW’s biggest fear.

So how can BMW continue to sell cars to its core market? Here’s what they are working on:

Electric Cars: One way to beat the rap on automobiles is to make them greener. Whether in car share or private ownership, electric cars (EVs) already are privileged with access to fast lanes, convenient charging stations and premier parking spots on streets and in garages. BMW is entering this market with the i8 and i3, two EVs with luxury appointments and, in the latter’s case, a compact urban size. As Tesla further shakes up the auto world, BMW needs to compete for the EV niche to stay relevant for urban mobility.

Car Sharing: Increasing numbers of urbanites are ditching car ownership to let someone else worry about the maintenance headaches. If you only use a car a couple of times a week you can outsource parking, fueling and insurance with car sharing. BMW sees a future market in car sharing, and they have started their own proprietary programs in nine European cities and are launching one (ReachNow) in Seattle this year.

Autonomous Vehicles: Google is making news with its fully autonomous vehicles, but BMW is taking a much more incremental approach to driver assistance. From automatic parallel-parking functions to truly autonomous handling on the Autobahn, BMW is increasingly adding functions that augment human controls to make driving safer and more relaxing. This approach requires fewer regulatory hurdles or risks than fully autonomous vehicles and adds value to existing lines of conventional cars.

Currently in the US, there is more than one car for every man woman and child. But change is coming. Urban dwellers are far less likely to own a car, even if they are occasional or even frequent users of cars. For car manufacturers, exposure to this shrinking market means featuring their vehicles in free-roving, urban car-sharing programs, or offering complementary cars to hotel guests for urban explorations. Car ownership will not be the norm, even if car use will still be ubiquitous.

Further out into the future, free-roving car-share will take on a new meaning: driverless cars will deliver you to your destination and then drive off by themselves to another errand. The distinctions between your car, a taxi or car-share will become meaningless as vehicles take on a utilitarian, almost public, function similar to airplanes, trains or buses. Yes, we will value them for their features, comfort and even level of luxury, but we may no longer covet them as personal possessions. For luxury automakers, this is a challenge to stay relevant in a more fluid marketplace.

Image courtesy of Aurimas/Flickr.

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