General Motors Co.is taking another step in its push to become a big player in car- and ride-sharing services by introducing its Maven brand to compete with the likes of Zipcar Inc.
The automaker will start a new service in Ann Arbor, Michigan, offering rentals of a Chevrolet Volt or Spark for $6 an hour and will expand car-sharing in some residential communities in New York and Chicago in the first quarter. The Maven start follows GM’s acquisition of the assets of Sidecar, a ride-sharing website that ceased operations in December, and $500 million purchase of a stake in Lyft Inc., an Uber Technologies Inc. rival.
The automaker is trying to catch up to companies such as as Uber and Zipcar that have found a fast-growing business in on- demand transportation that could replace the need for some people to buy cars. GM is trying to protect against that threat and find a way to do business with consumers in places like Manhattan, where high costs and limited parking have made vehicles ownership a rarity.
“Our business is built around the concept of the owner- driver model,” GM President Dan Ammannsaid in a briefing Wednesday. “We see changes in consumer behavior and we see significant opportunity as that change occurs. We want to make sure we’re at the forefront of this.”
Ammann said as many as 6 million people globally are using some form of shared transportation. He said he believes that will grow fivefold by end of the decade.
Maven’s car-sharing services, which provide rentals for periods as short as an hour, differ from the ride-sharing offered by companies like Uber or Lyft, in which consumers pay for a ride, just like hiring a taxi.
The $6 hourly fee that Maven charges is an introductory rate and the service has no membership fee. As GM tests its offerings in Ann Arbor, New York and Chicago, the Detroit-based company will get an idea of consumer usage and what rates make the business work, said Julia Steyn, the automaker’s vice president of urban mobility programs.
The automaker had already started a pilot program in New York at one residential building and is expanding that to other locations. The car-sharing programs in New York and Chicago will serve a total of more than 5,000 residents, GM said. Maven charges $9 an hour in New York.
All of the cars will have GM’s OnStar and connect to smartphone applications like Apple CarPlay and Android Auto. When someone rents one of GM’s cars, they will be able to use their phone to unlock the car and set their own music and other preferences.
GM has been building its car- and ride-sharing business through purchases and has put Steyn, its former vice president of mergers and acquisitions, atop its new mobility unit.
The push into new services is part of GM Chief Executive Officer Mary Barra’s attempt to make a case that the century-old carmaker is a technology company. Since she took over as CEO two years ago, GM has revealed the Chevy Volt electric car and a new Chevrolet Volt plug-in hybrid and has invested heavily in autonomous driving and Web-connected cars.
While Barra has pushed for investment in technology, Ammann negotiated the Lyft deal and has been overseeing the strategy.
“We believe there will be more change in the next five years than our industry has seen in the last 50 years,” Ammann said.
This article was written by David Welch from Bloomberg and was legally licensed through the NewsCred publisher network.