If you think the garage across the street is your biggest competitor, think again.
Your biggest threat may not be another parking facility at all. In the digital age, “location, location, location” isn’t what it used to be. Here is ParkingExec’s prediction about the 7 biggest trends threatening your business today.
7. Zipcar is taking 1 million cars off the road after a $500 million acquisition by Avis
Zipcar’s website states, “Save paradise, and tear down that parking lot.” With over 800,000 members, Zipcar has become a household name and was recently acquired by Avis for $500 million. They’re taking cars off the road by enabling consumers to share cars and park in pre-paid Zipcar-friendly spots. Hello Zipcar. Goodbye monthly parking. Aside from the select lots that park Zipcar’s fleet of 10,000 cars, everyone else in parking loses.
6. Americans are driving 1,200 fewer miles each year
Americans aren’t buying cars, and even those with access to cars are choosing not to drive. According to The Atlantic, declining car ownership among young adults is a result of changing values and lifestyles, not simply a side effect of the recent economic recession. If trends continue, this poses questions for our industry’s ability to attract new customers.
5. The fastest-growing mode of transportation, bike sharing, is stealing our customers
Bike sharing has launched in 9 major US cities, and if it hasn’t reached yours yet, it will soon. It’s so big that Citigroup spent $41 million to be the lead sponsor of New York City’s bike sharing program, Citibike. This healthy, cheap, and flexible mode of transportation is making city-dwellers think twice about driving a car, especially when parking their bike is free. How can operators combat bike sharing? Perhaps offering a way to park that’s as easy and convenient as sharing a bike.
4. Public transportation use is at its highest ever, because apps have made it so easy
From 1995 to 2013, public transportation use rose 37% in the USA. Mobile apps, from HopStop to regional transit apps, have made planning and paying for public transit easier than ever. Most cities have at least one app that makes public transportation more convenient and predictable for riders, encouraging more people to opt out of driving, and parking. Maybe parking operators need to get on the mobile app bandwagon next?
3. FlightCar raised $13.5 million to attack airport parking operators
Let’s face it, competing with free parking is tough. Competing with parking that pays drivers to park may be nearly impossible. FlightCar’s mission is to turn the tables on the parking industry by paying people to park their cars. They raised $13.5 million (from the folks who backed Facebook) to enable drivers to park at the airport, rent out their unused car, and earn cash while traveling. While FlightCar still operates on a limited basis in just five cities, what happens when they raise more money and expand to an airport near you?
2. Valet apps are investing over $12 million to proclaim “Parking Sucks”
Valet parking apps allow drivers to request a valet to pick up their car from any location, park it, and return it later, all with a few taps on a smartphone. While these apps are young (most popping up in the last two years), the industry has already raised over $12.5 Million in venture capital. They claim “parking sucks” and are trying to circumvent traditional operators.
For an overview of the on-demand valet industry, read our analysis and company-by-company overview.
1. One company, started just 5 years ago, is worth as much as the entire off-street parking industry in the USA
Uber, along with Lyft, SideCar and other ride sharing apps, provides an attractive alternative to parking in 100+ cities around the world. Citizens are fighting their government representatives to advocate for Uber. Millennials are Uber-ing as an alternative to car ownership. When a private driver is available with one tap of a smartphone for a fraction of the price of parking, we have to ask ourselves, “is that why we’re not filling more parking spots?”
Forbes predicts that ride sharing will not only convince people to skip out on driving and parking on one-time occasions, but it also will convince them not to buy cars in the first place. When consumers choose ride sharing apps, it is often in place of a taxi, but always instead of parking.
How do parking professionals fend off these threats?
Well, perhaps we need a heroic parking app that makes parking just as convenient as hailing a ride.