For decades, BMW has marketed its vehicles as the ultimate driving machines. With its fledgling car-sharing business ReachNow, BMW is not shifting that focus so much as suggesting that its machines can be enjoyed by more than one driver apiece.
Car enthusiasts may grimace, but ReachNow started up this spring in Seattle and added Portland, Oregon, in September. This week, BMW announced that it has started service in Brooklyn.
“It’s a great, dynamic city, and it has its own unique set of travel challenges,” ReachNow CEO Steve Banfield said. “We’ve always wanted to be a North American service, and planting a flag on the East Coast really sends a message that we’re not just a regional service.”
Seven months into its existence, the company says it has more than 32,000 members who have collectively put approximately 1.2 million miles on the 1030 cars in the ReachNow car-sharing fleet.
“The [price premium] for a 328 is six cents per minute. You’ve got to be really hyper-cost-conscious to say, ‘I’d rather not drive the 328.’ I think that’s pretty compelling.”
– Steve Banfield, ReachNow
Soon, those cars may be used for a slew of new services. As part of its expansion, the vehicles will be also available in an on-demand ride service that comes with a driver, or as part of a fleet-solutions service in which some cars will be based at residential properties, or as part of a new pilot program that allows users to rent one for two to five days. In Seattle, BMW will start a test program that allows certain Mini owners to rent their vehicles at times they’re otherwise sitting unused.
ReachNow currently offers customers a choice of five BMW products: the BMW 328i xDrive or electric i3, the Mini Clubman, and the Mini Cooper two- or four-door. Banfield said the X1 crossover will be added to the fleets soon.
The mix of models varies by city. In Seattle, there’s been proportionate interest in all the offered models, whereas in Portland, users have preferred the Minis over the 328, according to Banfield. He expects the X1 will appeal to Portlandians seeking a vehicle to complement an outdoor lifestyle. In Brooklyn, he thinks the Mini might be favored for easy parking in tight quarters. Users locate and book the cars via a smartphone app.
Car sharing has gained steady traction in Europe over two decades. The North American market has been slower to develop, but a report released earlier this year by the nonprofit Center for Automotive Research projects 23 percent growth in 2016 and slower growth through 2021. It’s less clear what comes after that for the broader car-sharing market.
But five years from now is when BMW, in conjunction with partners Intel and Mobileye, says it intends to bring forth a self-driving-taxi service. ReachNow will likely serve as a launchpad for those shared autonomous vehicles. “As those cars come on the line and those capabilities come online, they’ll end up in our fleet,” Banfield said.
For now, ReachNow will focus on establishing a foothold in the car-sharing marketplace. Introductory rates allow users to use a car like the Clubman for as low as 41 cents per minute, a price that is not coincidentally the same as the one offered by car-sharing company car2go for use of its Smart vehicles. Daimler, parent company of BMW rival Mercedes-Benz, started car2go in 2008 and operates fleets of Smart cars in 12 North American markets, including Portland and New York. It is the second-largest car-sharing service in the world, behind Zipcar.
Banfield downplayed competition between the rival German luxury-car brands but notes that car2go’s Smart vehicles have limitations.
“You cannot pick up your in-laws at the airport in a Smart car, but you can commute to work,” he said. “Car2go is like Southwest Airlines. You know they’re consistent, and you know they want to do a good job in service and treat customers well. But their goal is ‘inexpensive,’ and there’s a place for that in the market. We’re trying to do something different, and there’s room for both. You know, the difference for a 328 is six cents per minute,” he said. “In a 10-minute ride, that’s a 50-to-60-cent difference, and you’ve got to be really hyper-cost-conscious to say, ‘I’d rather not drive the 328.’ I think that’s pretty compelling.”