South Korean car maker Hyundai has announced it will invest $6.2 million into Australian car-sharing platform Car Next Door, bringing the company’s total investment in the company to over $8 million over the past 12 months.
Founded in 2013 in Sydney, Car Next Door now boasts over 3,000 cars listed and over 150,000 members (as of 2018) and has paid out over $5 million to car owners.
According to the company, the average person in Sydney, Melbourne, or Brisbane makes between $3,500 and $7,000 renting out their car when they aren’t using it, while some – such as those with utes or vans – make between $10,000 and $12,000 per year.
The company also claims that for every Car Next Door share car, 10 other cars are taken off the road. In addition, however, when you borrow a car through Car Next Door, “all of the carbon emissions from your driving are offset through Greenfleet‘s native reforestation projects around Australia.”
Car Next Door also entered into a partnership with Hyundai back in July of 2018 “to bring sharing ready cars to Australia and increase the number of hybrid and electric vehicles in the Car Next Door community.”
The first stage of the partnership between the two companies saw 16 new Hyundai Ioniq Electric vehicles listed on Car Next Door.
The continued partnership between the two companies is aiming at introducing even more eco-friendly cars to the Car Next Door fleet, as well as making it easier for Hyundai owners to list their cars and moving towards adding the fully electric Ioniqs to the service.
Hyundai’s new $6.2 million investment into the car-sharing company’s platform is intended to help with the development of “sharing ready” cars.
“This is the future of connected green cars, where the ability to car-share is built into the hard-wiring of the car making it easy for one car to be used by multiple people,” said Hyundai Motor Company Australia CEO JW Lee.
“This capability has been pre-installed and seamlessly integrated into Hyundai cars, making it easy for Hyundai owners to earn extra money from their car when they are not using it via Car Next Door’s innovative sharing platform.
“Other features include access and ability to unlock and start the car via a mobile phone app – ultimately negating the need for traditional keys.”
Hyundai’s investment is also set to help Car Next Door expand its operations, helping it move beyond urban centres.
Given that the average Australian car is used for only 4% of the time, according to Car Next Door CEO and co-founder Will Davies, expanding the company’s operations beyond urban corridors into suburbia, exurbia, and the countryside, could open up significant opportunity for Australians.
“For that 96% of the time they sit idle, they could be used to create an extra income and help to reduce parking congestion and pressure on our roads,” said Davies.
Hyundai’s investment also serves to safeguard the company, at least in part, against a future where car sharing – especially sharing of electric vehicles – is more prominent, and the desire to own a new car diminishes.
Keith Noh, deputy general manager of Hyundai Corporate Venture Capital Team said that the company is exploring a variety of new business models including car-sharing, ride-sharing, and subscription models, all of which can provide benefits for its customers over time.
When asked why Hyundai is investing in and investigating platforms which essentially serve to discourage people from wanting to buy a new car, Noh said that the company wants to be “part of innovation through collaboration”.
“The market is moving to shared mobility regardless of what Hyundai Motor’s strategy or will is, so it is clear that our best option is to pursue what customers want rather than what we might like in our ideal world,” he said.