At 17 million square kms, Russia is the largest country in the world. Or to put that in automotive terms: it would take two weeks to drive from one end of Russia to the other. This huge country has a huge capital, and both need a huge fleet. For the past few years, Moscow has been a laboratory for car-sharing. The experiment has proved successful and, says a study by LeasePlan Russia, the formula is spreading to the rest of Russia.
The entire automotive stock in Russia is about 42 million vehicles in private ownership, and 3.5 million in corporate fleets. Annual vehicle sales amount to 1.5 million units, mainly to the private sector. But attitudes towards ownership are shifting, and Russians are warming to car-sharing as an increasingly mainstream alternative.
Car-sharing in Russia took its first tentative steps in 2013, in Moscow and St. Petersburg. By 2015, the formula was familiar enough for Moscow city authorities to announce plans to expand the Russian capital’s car-sharing fleet to 10,000 cars. That target is still far off: the overall car-sharing fleet in the capital today totals about 3,000 cars. In the rest of Russia, car-sharing totals more than 2,700 cars. As of now, The largest companies on the Russian car-sharing market are: Delimobile, Car5, YouDrive, AnyTime and BelkaCar.
In Moscow alone, more than 300,000 customers subscribe to the various car-sharing schemes that are on offer. In the 20-month period from September 2015 to May 2017, the number of car-sharing trips undertaken by Muscovites exceeded 1.3 million. Each shared car is used by an average of eight people a day. The average car-sharing trip lasts 37 minutes.
The target customer for Russia’s car-sharing services has a distinct profile: young to middle-age (21-40 years old), metropolitan and with a preference for self-drive over taxis – the financial savings are a major factor in this. Around 90% of Russian car-share customers has one or two university degrees. Job-wise, they are mainly full-time employees, top executives or business owners. The share of blue-collar and unemployed customers of car-sharing services is minimal (5-7%).
Four factors are driving the growth of car-sharing in Russia. Firstly, a change in attitude towards car ownership, or more precisely: the cost of car ownership. Studies show the average ‘owned’ car sits idle for up to 90% of the time, which of course has implications for the effective cost of the car (when it is actually used).
Secondly, the transport situation in Russia’s big cities is critical in terms of traffic density and traffic jams, and the limited availability and high cost of parking spaces. These factors are pushing the demand for alternative mobility solutions.
Thirdly, Russia is very advanced when it comes to adopting technological innovations, which permeate virtually all aspects of everyday life in the country. Russians are very savvy when it comes to ordering items online, for example.
And finally, operational leasing has become the technical platform of choice for car-sharing companies. This allows them to concentrate on their core business, leaving fleet management to the lessors. Another big advantage is financial, i.e. being able to forgo the acquisition of the vehicles themselves. Among suppliers for car-sharing companies in Russia, LeasePlan currently is the market leader (43%).
Over the next two years, car-sharing will break out of the two big cities and become available in 15 cities with a population of more than one million, as well as in several resorts on the Black Sea.
According to projections by LeasePlan, the Russian car-sharing market outside Moscow will exceed 5,000 vehicles by the end of this year, and grow to 7,000 in 2018. By that time, the Moscow car-sharing fleet alone should number between 10,000 and 15,000 vehicles.
All operators are planning for this expansion beyond Moscow and St. Petersburg, as the awareness of the advantages and the convenience of leasing are growing among the Russian business community and the general population.
- Car-sharing in Russia is about to boom