BMW perfectly understands that the traditional ownership model for the automobile is fading fast. Car sharing and ride hailing services, such as Uber and Lyft, are putting a lot of pressure on automotive companies’ sales in urban cities. The idea is, why spend all that money on owning a car when you can just use a service for a significantly lower cost? In urban cities, where car ownership has always been less popular, this is extremely attractive. That’s why BMW started DriveNow.
A car-sharing service that allows people to rent BMW owners’ vehicles for a short period of time, DriveNow allows BMW to get a slice of the pie that it’s losing to Uber. Daimler started its own service as well, called Car2Go, which does essentially the exact same thing. So, to lower the costs of these business as well as increase profits and expand, BMW and Daimler are considering joining forces and combining their two companies.
If this were to happen, both services will keep their respective names but operations would be a concerted effort. This could significantly help BMW and Daimler in a market that’s currently dominated by non-automotive companies and tech companies. Nothing is official yet, but we could see a boost in popularity for both services if the two companies were to team up. Two heads are better than one, right?
[Source: TechCrunch]
