Car Club Blog

Streetcar, the car club started four years ago by two university friends, has undergone a 10 per cent rise in membership since Alistair Darling imposed a steep increase in car taxes in the Budget last month.

The club, which has 30,000 members and 750 cars in six cities in the UK, has had 3,000 people join since the Chancellor said that drivers would have to pay a showroom tax of up to £950 for the biggest gas-guzzlers.

Brett Akker, co-founder and joint managing director of the club, expects to double its membership this year and to have 1,000 vehicles on the road, as motoring costs climb and as the congestion charge in Central London rises for larger vehicles in the autumn.

Mr Akker said that a membership of 250,000 was a realistic goal for 2012. The business was started with eight cars in South West London in 2004 and has expanded beyond the capital since. Members pay £49.50 a year to join, a fee that covers their insurance. They are given a swipe card, which gives them access to a cluster of cars - VW Polos or Golfs - parked close to where they live. The swipe card opens the car and a PIN turns off the car’s immobiliser and gives access to the glove compartment, where the keys to the ignition are. Members pay £3.95 an hour for the Polo and £5.95 for the Golf. Car hire for 24 hours costs £39.50 and weekend hire is £90.

Most members choose not to buy or replace a car and use cars only for journeys on which they are needed, Mr Akker said. Transport for London, which is spending £4.3 million to help London boroughs to find parking places for car clubs, has calculated that each car club vehicle on the road replaces an average of 20 privately owned cars.

Using research from the AA, Streetcar calculates that using your car for two short trips a month and one trip a month would cost around £2,750 a year. The equivalent cost of using a Streetcar would be £700.

Smedvig Capital, a small private equity group, invested £6.4 million in the company last year but there are no plans for further fundraising.