Toronto resistant to car2go’s ‘free-floating’ car-share program

Hamburg, Germany and New York have already said yes to car2go's "free-floating" car-share service.

That means customers in those cities and more than 20 others don't have to take their car2go vehicles on a round-trip, returning them to a designated spot when they're done. Exact rules around free-floating vehicles differ from city to city, but the idea is that cars can be left in any public parking spot, offering users the convenience of getting to point B without having to return to point A.

Free-floating is an essential element of car2go's service, said Josh Moskowitz, the company's regional director, and introducing the model to Toronto was the goal when car2go launched here five and a half years ago. But the company's plan to free-float its 375-car fleet hit a snag in early February, when city council declined to approve a one-year pilot program.

"They were clearly disinterested and didn't do their homework," said Mr. Moskowitz of councillors' response to the proposal, which was initially meant to be considered last September. The pilot would create 2,000 one-year permits for free-floating cars that could be left on all streets that allow permit parking – after the last deferral, car2go agreed to eliminate streets with waiting lists for a parking spot.

The proposed permits would cost $1,500 each, with individual companies limited to 500 permits. The estimated revenue was $1-million. Even so, councillors expressed concern that car-share vehicles would infringe on private-car owners who pay for parking permits. Though multiple studies have found that car-share programs reduce private-car ownership – and so help to ease parking congestion – many saw ceding scarce parking space to shared cars as accommodating private businesses at the expense of residents.

The pilot was deferred again. The next day, car2go sent a frustrated e-mail to its 75,000 Toronto members signed by Paul DeLong, its Austin, Tex.-based CEO and president, accusing council of going back to "bureaucratic square one."

"We are forced to re-examine our operations moving forward in Toronto," it read, which many interpreted as a threat to leave Toronto entirely.

That would disappoint Councillor Mike Layton, even though he's the one who moved to send the pilot proposal back to the public works and infrastructure committee. "I'm a supporter, not only because I'm a member, because I think it's a good idea," said Mr. Layton, who belongs to both car2go and Enterprise Carshare.

He said he moved to defer the pilot because he sensed that his colleagues might turn it down entirely. "If we vote on it and it fails, it's gone for a year. We don't open it up again, the decision stands until the next term at council, 2019," Mr. Layton said. He's hoping council will approve the pilot in April or May, after they've had time to consider it longer.

Owned by German auto maker Daimler AG, car2go has a fleet of 375 cars. Its main competitors all offer the round-trip or "stationary" model: Enterprise Carshare, which has more than 400 cars; Zipcar, which has 700 cars; and Maven, a new service owned by General Motors that launched in Toronto this month with 40 vehicles.

Stationary services have trouble finding parking too, which can make them inconvenient. The Car-Share Vehicle Parking Area program, which turns unused street space into car-share parking, has only created 80 new spots in the decade-plus that services have been around.

"My usage has gone way down," said Kyle Angeletti, who lives in a condo at Dundas St. E. and Carlaw Ave. in Leslieville. He currently has a car2go membership, but no longer uses Enterprise Carshare. That service used to have two cars in his building, but those disappeared about two years ago, around the same time that condo builds along Queen St. E. eliminated a number of lots that had held other car-share vehicles.

"From my perspective, I'm struggling. I've really enjoyed using car-shares in the past," Mr. Angeletti said.

It's tricky for companies to rent parking in midtown neighbourhoods such as Leslieville, which have few big-surface parking lots. Condo developers often gain flexibility from official plan parking provisions by providing car-share spots in new buildings, but "we have no way of guaranteeing or ensuring that that car-share is in use at the end of the day," Mr. Layton said.

Staffing is a concern: at the Bohemian Embassy condo complex on Queen St. West, for example, a concierge allows Enterprise users into the parking lot. Buildings that don't have all-day staff sometimes provide car-share users with a door code to the parking lot, but some consider this a security risk.

"In the design phase, that should have been considered. They shouldn't say after the fact, 'oh no we can't,'" Mr. Layton said. "It should be on developers, it shouldn't be on condo boards." He'd also potentially like to see private homeowners be allowed to rent space to car-share companies.

Toronto isn't the only city currently deciding whether to let car2go free-float: a similar proposal is currently in front of Chicago's city council. If it does pass here, it will be despite council's displeasure at tech startups' disruptive tactics. In April, 2016, for example, car2go advised its members in an e-mail to park as though free-floating had already been approved, a move that Mr. Moskowitz said increased the company's visibility so much that its membership increased 55 per cent.

"They were actively encouraging their subscribers to park illegally, which I think has raised some red flags for some councillors, particularly after the Uber debate," Mr. Layton said. Car2go also showed up to February's council meeting with $730,000 in unpaid parking tickets.

Mr. Angeletti has a car2go membership, but the dots on his app indicating cars near him disappeared when the company chose to free-float without permission. "There used to be a dedicated lot on Gerrard between Degrassi and Broadvew, right between the Asian groceries, there used to be always four or five that I could count on," he said. "Now I can't really count on any little groupings of them even within a 10-minute walk," Mr. Angeletti said.

He's hoping that will change soon. "I appreciate that on-street parking is at a premium … I get the issues of lack of supply, but this is a service that tons of people use," he said. "I would love to see it improve."