While other car companies have been dancing around the future where no one owns cars, GM is asserting itself and positioning for the win.
“We see the emergence of car-share/ride-share as much more of an opportunity than it is a threat,” said GM’s president Don Ammann during a press conference for reporters.
On Thursday, the company plans to announce a new service, Maven, which pulls together its assembly of car-sharing services into its bet on the future.
GM has tested services where people share their own cars, but Mavens will incorporate that with a twist. Instead of needing to own one, GM will supply cars that customers can rent by the hour or for days. Unlike a traditional rental car spot, there’s no counter or clerk — you just walk up, unlock the car with an app, and go. As long as you return it to the same parking spot, you’re good.
While a part of GM, Maven is its own consumer-facing name and service designed to compete (and hopefully surpass) startups like Getaround, Zipcar, and Turo, which have pioneered the car-sharing industry.
“A Maven customer would download the app and that smartphone will be used as the key to the vehicle. When you come to the car, you can open the car for you and you can be on your way,” Steyn said.
Plus, the app will include options like remote heating and cooling, so the car will match your likes from the moment you get in, she added.
Rather than blanketing cities in parking spaces, Maven is also tailoring its programs to be designed for the location.
Its residential option in New York City lets apartment dwellers in the same building share a car. For its new pilot in Ann Arbor, Michigan, Maven is installing 21 parking spaces around town and the University of Michigan’s campus to give students and residents alike a chance to rent a vehicle for a short time.
It’s not a revenue-generating endeavour for the company, yet. The cars in Maven’s program start at $6 an hour, so it would need to be driven many thousands of hours before paying for itself.
As Ammann explained, the reality is many people still want to own cars, and GM expects to sell millions of those cars for many years to come. However, there’s also a growing segment of the population who aren’t as interested in buying cars as generations past — and that’s who GM is courting with Maven.
“We do see significant change in consumer behaviour,” Ammann said. “And we see significant opportunities as change occurs. We very much as a company want to put some thought into the forefront of that.”
The rebound of GM
Six years ago, GM was on the brink of failure. Amidst the financial crisis of 2009, the automaker filed for bankruptcy, shed its brands like Hummer and Saturn, and tried to turn itself around.
The auto industry looked bleak for many a company. At the same time, a little upstart called Uber was launching in San Francisco.
Fast forward six years and the auto industry is recovering strongly, but the road to the future has changed. Uber claims it will do away with cars, and is already making a dent in it.
The auto business has changed as much in the last five years as the 50 previous, Amman said, reiterating industry lore.
GM has already cut $5.5 billion in costs to help finance its investment in new technology.
GM and every legacy automaker can’t lose out. Maven is one part of GM’s answer.
Moving like a startup
The signs toward the launch of Maven have been planted along the way, but it took until today for GM to pull them into a cohesive bet on the future.
Earlier this month, GM announced a strategic partnership and an investment in Lyft. GM will supply Lyft drivers with mini car rental hubs, and the new pair are working on a line of autonomous vehicles.
Secretly, in December, GM also signed the paperwork to acquire a rival to Sidecar, Lyft and Uber. One of the pioneers of ride-hailing companies and owner of a particularly important patent that could challenge Uber, Sidecar shut down at the end of the month and handed over its IP to GM. 20 team members joined the Maven team, although Sidecar’s CEO didn’t make the leap.
Meanwhile, the automaker also has been stealthily poaching employees from Google and Zipcar, one of the original car-sharing services.
Across the world, GM has also been testing variations on the car-sharing idea. Its residential program, previously called Let’s Drive NYC, placed cars in the parking garages of apartment complexes like an added perk. Instead of anyone having access to the car, only residents of the building could rent it for a trip to the grocery store or a quick day trip.
It’s a model that proved successful since its October 2015 launch. Now folded into Maven, the residential program will be expanding into Chicago and to more New York locations in 2016. The company estimates that portion of the business will reach more than 5,000.
GM had also been testing on college campuses in China and Germany. Those have been the proving ground for much of Maven’s development, Steyn said. Another peer-to-peer testing network in Germany has already had 10,000 people use the service, she added.
Steyn chose the name Maven because it means expert and connoisseur. Now GM faces the task of living up to it if it wants to win the car-sharing class of the future.