PHOENIX – For Marcus Jones, signing up for an Arizona State University car-sharing program offered through Zipcar provides the convenience of a car without the commitment.
Since joining, Jones has used the service a couple of times each month, renting a car by the hour for trips around town. Using Zipcar introduced him to the Scion XP, a car he said he enjoyed and wouldn’t mind purchasing.
“I wouldn’t say it’s necessarily a brand issue; I would say it’s more the functionality. The brand should be reliable,” Jones said. “It needs to be a different type of car for each student based on their needs.”
Car companies are starting to place their bets on college students like Jones as car-sharing programs grow at universities across the state and country.
“They’re not buying cars the way previous generations have,” said Liz Elser, brand manager for Ford Motor Co. “The millennial generation grew up buying songs on a one-off basis rather than buying the album, so it’s much more natural for them to think about renting a car for an hour rather than buying them outright.”
Ford Motor Co. recently signed a deal with Zipcar, a national company based in Cambridge, Mass., that would bring Ford vehicles to 250 colleges, including ASU. Ford Focuses and Escapes will be added to the fleets, Elser said.
Ford, which has previously struggled with selling cars to this demographic, saw the partnership as an investment toward the future and an opportunity to develop brand loyalty.
“They’re a difficult demographic to reach – the millennial generation – in particular again because their purchasing habits are different than previous generations,” Elser said. “They’re more about convenience and access rather than ownership.”
Zipcar users pay a one-time application fee of $25 and an annual fee of $50. They can then reserve a car and pay by the hour or day for its use.
James Ward, a marketing professor with ASU’s W. P. Carey School of Business, said university students are a natural market for companies such as Ford.
“A significant motivation (for the deal) would be to expose consumers to their new car models and, if you think about the kinds of people or the demographics that are likely to do temporary car rentals like a Zipcar, they will probably tend to be college-educated … more upscale consumers later on, obviously younger, and so they’re really a prime target audience for a car company,” Ward said.
The partnership will also allow the company the chance to expose university students to its more innovative technologies, he added.
The Focus is energy-efficient at 40 miles per gallon, geared toward the environmentally friendly demographic that uses university car-share programs, Elser said.
“It’ll help guide their car purchasing down the road,” she said.
The agreement will amount to 1,000 Ford cars over two years, or 50 percent of Zipcar’s university fleet, according to Colleen McCormick, Zipcar’s public relations specialist.
Zipcar currently offers other makes, including Toyotas, Hondas and Nissans, but Ford will be its largest provider, McCormick said.
At ASU, there are currently 17 cars in the fleet and around 3,000 students enrolled in the program, according to Leona Morales with the university’s Parking and Transit Services.
University of Arizona also has a car-sharing program that is offered through rental company Hertz. Northern Arizona University has its own program, according to the Association for the Advancement of Sustainability in Higher Education.
Ward, the ASU marketing professor, warned that there could be a potential downside for car companies trying to develop loyalty to their products through services such as Zipcar.
“The program encourages people to be more faithful toward renting,” he said. “That might decrease demand for cars.”
Victoria Pelham is a reporter for Cronkite News Service