City Car Club set for sale 25 | 04 | 2011
THE CITY CAR CLUB, the pay-as-you-go 'green initiative' which was founded in Edinburgh in 1998 by James Finlayson and now operates in 14 cities — including Glasgow — across the UK is set to be sold.
Findlayson, the company's chief executive and largest shareholder with a 30% stake, has hired corporate finance firm Cavendish to handle a sale after receiving bids. Mr Findlayson can sell providing there is agreement from 75% of the other shareholders.
The City Car Club has mushroomed from its original launch — with a handful of vehicles run on behalf of Edinburgh City Council by Budget car rental — to a UK-wide operation and one of the largest car club operators in the country with 500 cars and more than 20,000 members.
Members pay an annual fee of £50 and can book low-emission cars and vans by the hour, day or longer. All vehicles have a dedicated parking bay and the company covers insurance, tax and cleaning.
Typical costs for a Fiat 500, Toyota IQ, Vauxhall Corsa and Ford Fiesta are £5.20 an hour or £42 for 24 hours. A van costs £8.20 an hour or £72 for 24 hours.
Initial reports indicate the sale could generate up to £10 million as private equity investors as well as carmakers and rental firms eye the expanding sector.
The City Car Club generated sales last year of £3.5m and though it is yet to make a profit, it is expected to move into the black next year. The car-sharing sector is thriving with motoring giants such as BMW and Daimler showing an interest.
The Edinburgh City Car Club, which was the first in the UK, estimates drivers covering around 7000 miles annually could save £1500 a year by sharing rather than owning, taking into account MoTs and maintenance costs. A study carried out across UK cities also found each car removes 24 privately-owned cars from the road.
The car club has more than 4000 members in Edinburgh and more than 100 cars in many parts of the city including the airport and Waverley station.
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Jim McGill