I recently wrote a review of Car2Go Denver and someone asked if they could save money using Car2Go. The answer, as always, depends on your own personal finances and circumstances, but let’s take a look at how you might save money using Car2Go or another car sharing service.
Car Sharing or Auto Sharing
Keep in mind the difference between ride sharing and car sharing. With ride sharing, you ride in a car with someone else. With car sharing, you “share a car” with other people. While this is technically true, in reality what you are doing is renting a car by the minute. So, can a car sharing membership save you money? To find out, we need to know about the costs.
Car2Go in Denver charges 38 cents per minute. This doesn’t sound like a lot, but it can add up quickly, especially if you end up driving during heavy traffic. For a quick 10 minute drive to the grocery store, a Car2Go rental costs you $3.80. Of course, you’ll have to get back home too, so we’ll call it $7.60, round trip. Not bad.
Whether or not that will save you money is going to depend on your current situation.
Owning a Car versus Car Sharing With Car2Go or Others
Whenever someone from the marketing department says that you save money using Car2Go, they are comparing the cost of using Car2Go to the cost of owning and operating your own vehicle. This is a fair comparison, but it only works in reality if you are considering either selling your car to use Car2Go instead, or forgoing buying a car by using Car2Go. If you already own a vehicle, or if you are not getting going to be getting a vehicle, that comparison isn’t going to be helpful. The most important thing in making a valid comparison is to compare apples to apples. In this case, the trick is getting a useful period of measurement. Comparing monthly costs will provide accurate estimates.
This comparison about which is more economical, a car share or owning a car, depends a great deal on whether or not you are making payments on the car. Obviously everyone’s own personal situation is a bit different, but by plugging your own numbers into the scenario, it should be rather simple to get a good answer about how much value you can get from Car2Go. These scenarios are derived from commonly seen numbers and values for people living in, or around, Denver, Colorado. You will have to adjust insurance and taxes based upon where you live.
- Car Payment: $300 per month
- Gas: $120 per month
- Car Insurance: $600 per year / 12 months = $50 per month
- Taxes: $300 per year / 12 months = $25 per month
- Average Monthly Repair / Maintenance: $400 per year / 12 months = $33 per month
Total out of pocket cost of owing car: $528 / month
Number of hours you could drive a car to go for $528: 23.16
Number of hours you could drive a car to go if you have no car payments ($228 per month): 10
In other words, if you don’t drive very often, and you don’t drive very far, Car2Go could really save you a lot of money, especially compared to making a new car payment.
The catch to this, as mentioned above, is that these numbers only make sense if you are comparing owning a car to not owning a car. If you own a car, the only value above you can really save on is gas. All other expenses are going to be incurred whether you drive the car or not. Even if you have a gas guzzler, chances are 38 per minute will be far pricier than using a Car2Go.
The other thing to keep in mind for people driving where paid parking is an issue is that we did not include that above. If, for example, you work in Downtown Denver and would have to pay $150 per month for a parking space, that is something to keep in mind as well. Also, there is a limited area in which you can feasibly use Car2Go, so if you make frequent long-range trips, this is obviously not the way to go.
How Car2Go Can Really Save You Money
There is one way that Car2Go can really save you a lot of money. For some couples and families, having two cars is a necessary but infrequent necessity. For example, I work from home as a freelance writer, but I also have to take kids to school, run errands, and so on. For us, two cars is really the only feasible option, especially because there are two kids, but only one passenger seat. However, for many couples and families, the need for the second car is rather infrequent. Here, a Car2Go membership could conceivably save you hundreds of dollars per month.
In this case, imagine a different family where one spouse works and takes the bus while the other spouse uses the family car. The only real time a second car is needed is if the working spouse has to work different hours, or if there are weekend or evening activities that require two separate modes of transportation. Now, a few Car2Go rentals per month are clearly superior to the expenses of a second car payment, insuring the second car and paying for gas, registration, and all the other things that go with a second car.
In the end, Car2Go is really a great filler for people who don’t usually need a car (or second car) but find they occasionally have the need. For people like me, who own their cars without any payments, the value exists really for special situations.