Share

How Audi’s Acquisition Of Silvercar Expands Its ‘Shared Mobility’ Ambitions

By purchasing Silvercar, Audi is looking at more than just a vehicle rental service; it's all about shaping the role of cars.

Two years after Audi took a minority stake in Silvercar, an airport-focused rental car company, the automaker is making its ownership complete as part of its wider efforts to influence the future of transportation by tapping into the  “shared mobility” concept.

Shared mobility refers to a range of technology tools that power the wider “sharing economy,” like the “pooled” ride-hailing services from Uber and Lyft. More specifically, the idea is primarily is related to the municipal transportation features of “Smart Cities” like app-based bike sharing and car rental companies like ZipCar.

For Audi, which is part of the German automaker consortium that owns online mapping and navigation platform HERE (along with Daimlier and BMW), the reason for acquiring Silvercar outright is to build a greater presence in car-sharing in the U.S.

Smart Car Rentals And Sharing

For Silvercar, which has offered the Audi A4 for its car rentals, the benefit is that it will have greater support beyond the 15 airport location it currently serves. (Among the location Silvecar is available at include Chicago O’Hare Airport, Austin-Bergtrom, Dallas Lovefield, Las Vegas’ McCarren Airport, and Los Angeles’ LAX.)

“Audi and Silvercar share the same vision,” says Dietmar Voggenreiter, Board Member for Sales and Marketing at AUDI AG. “We want to open up a new, flexible way to access mobility for our customers while offering premium quality in every respect. Now we are joining forces and, together, are driving our initiative for innovative mobility services forward.”

With Silvercar, Audi is betting that the combination of the sharing economy and autonomous vehicles will make private car ownership just one of many models that consumers will adopt.

Audi lining up for Silvercar

In contrast to the railroads being “disrupted” by cars and air travel — the classic mistake of not realizing they were in the broader transportation business, as opposed to the more narrow rail business — Audi and other automakers are positioning themselves for the next era of road travel.

“I believe, as does the Silvercar team, that we are on the verge of the most profound changes in the 120-year history of modern personal transportation,” Silvercar CEO Luke Schneider wrote in a blog post about the Audi deal.

Automakers’ Future Success

As such, carmakers’ future success will be measured in “miles traveled” as opposed to the number of cars actually sold, Adam Jonas, head of global auto research for Morgan Stanley, has opined in a study of the impact of driverless and connected cars will have on the automotive industry.

By 2030, cars will drive more than 19.6 billion miles globally — considerably higher than the 10.2 billion they traveled in 2015, Jonas has estimated. It’s worth noting that the pace of growth is much higher than the estimated production of cars and light vehicles during the same period.

“The natural solution appears to be more shared vehicles,” Jonas said. “Shared cars—taxis and cars operated by ride-sharing companies, but not car rental—in 2015 accounted for 4 percent of global miles traveled, but by 2030, Morgan Stanley estimates that number could reach 26 percent.”