GM partners with RelayRides for car sharing

Written on:October 5, 2011
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Auto giant GM is making its first move into car sharing by partnering with San Francisco-based peer-to-peer car sharing startup RelayRides. A GM Ventures exec told us a year ago that GM wanted to get some “skin in the game,” around car sharing, but this exclusive partnership will be based around GM’s communications system Onstar.

In 2012, RelayRides members will be able to use GM’s Onstar service to unclock cars they have reserved in the RelayRide’s network via a mobile phone. RelayRides normally installs a communications device in a vehicle to facilitate the reservation process, but in designated GM cars, the Onstar system can act as that control gadget. RelayRides says it will also be launching its own mobile app in 2012.

The partnership is a validation of RelayRides, which was one of the first of a growing number of startups to launch a peer-to-peer car sharing service. Via these so-called “car sharing 2.0″ companies, members can rent out their neighbor’s personal cars. In contrast in car sharing networks like Zipcar and CityCarShare, the organization owns the fleet of cars. In P2P car sharing, car owners can also make money off of the transaction.

RelayRides is different from P2P competitors like Getaround, because RelayRides installs the communications device in the cars itself (Getaround in contrast sends members a kit to install themselves). While RelayRide’s method takes longer to install, the company says this makes its system more secure and also easier to use once it is up and running. For applicable GM cars, the GM deal could help ease the friction of having the car owner wait for the installation process, and the partnership also is a validation of RelayRide’s emphasis on security.

Auto makers have an interesting relationship with car sharing. Car sharing has been proven to lead to fewer cars being bought, so in a small part, car sharing is cannibalizing the auto maker’s business. But a variety of automakers are realizing that they can benefit from car sharing in various ways, including getting their cars in front of the young and urban that normally wouldn’t be test driving their cars. Other companies, like Daimler, and Volkswagen, are trialling their own car sharing pilots.

GM vice chairman Stephen Girsky says in a statement that: “Our goal is to find ways to broaden our customer reach, reduce traffic congestion in America’s largest cities and address urban mobility concerns.” For more on the relationship between big auto and car sharing, see GigaOM Pro Green IT analyst Adam Lesser’s column: Car sharing and the impact on the automotive industry (subscription required).

RelayRides also says that GM Ventures is “in advanced discussions” with RelayRides about investing in the company. We’ll be highlighting the themes of connected car and collaborative consumption at our RoadMap event in San Francisco on November 10.

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Related research and analysis from GigaOM Pro:
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  • Car sharing and the impact on the automotive industry
  • Mobile apps: the next gateway to greater efficiency
  • Flash analysis: Collaborative consumption – a first look at the new web-sharing economy


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