Rumor: Car2go and DriveNow merger

Date: 19 AUG 2017posted by Car Rentaledited by WinX

The chief executive of car rental company and DriveNow partner Sixt hinted on Thursday they may be in talks to combine their car sharing services with Car2Go. German auto manufacturers Daimler owns Car2Go while BMW owns DriveNow. Ride hailing companies such as Uber and Lyft are in direct competition for the same market as the car sharing services of Car2Go and DriveNow. Both Uber and Lyft have started offering pay-per-use mobility services bringing more direct pressure to the German subsidiaries. Experts believe in order to compete with the ride hailing giant Uber, a merger of Car2Go and DriveNow would be the only way to pool enough resources to even have a competitive chance.

The rise of such services has already affected other markets such as the car rental market since these services offer the convenience of mobility without the necessity of car ownership. Asked whether Sixt was involved in merger talks with Daimler and BMW, Chief Executive Erich Sixt said: "At the last press conference I made clear that we are not involved. Today I can only say 'no comment'. This is of course a slightly different statement from the last one. Why things are dragging on is not down to us." Last May Sixt had stated they were not involved in any merger talks, but had also stated that their 50 per cent stake in DriveNow has been valued at around 480 million euros ($560 million).

Car2Go has declined to comment and no one at DriveNow has been immediately available for a comment. A spokesperson for BMW said, "we are in constant talks with our partners and are of course evaluating the strategic options for our activities and stakes," when being asked whether BMW was in talks to combine their car-sharing services with Daimler's. Car-sharing services has begun marking their territory in major European cities such as London, Frankfurt, Berlin, Milan and Helsinki, where customers enjoy free parking, a major cost and convenience factor. Research has found more than a third of clients who tried BMW's DriveNow in London has sold their cars, opting to use the convenient service while only 20 per cent were determined to keep their privately owned vehicles. BMW and Daimler are both in the works for developing autonomous vehicles. If successful, autonomous vehicles would be able to replace taxis, ride-hailing services and even the car rental business.

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