The move, confirmed by its owner Avis Budget, means Londoners will lose access to thousands of shared cars and vans, and no new bookings will be allowed after 31 December while the company consults staff on redundancies. Zipcar UK currently employs 71 people.
The closure is a major setback for supporters of car-sharing as a greener alternative to owning a car. Some car clubs that used Zipcar’s platform to share private vehicles will also be hit.
In an email to customers, Zipcar UK’s general manager, James Taylor, said: “We are proposing to cease the UK operations of Zipcar and have today started formal consultation with our UK employees.” He directed users to CoMoUK, a shared-transport charity, to find other car-sharing options.
The decision comes after a difficult period for car-sharing operators. Earlier this year it emerged that Avis Budget had downgraded Zipcar’s valuation due to falling revenue and rising costs in several markets.
The timing also coincides with major changes to London’s congestion charge, which from January will apply to electric cars - including those used by car club members. Zipcar would have faced up to £18 per day per vehicle entering the zone. Industry estimates suggest the rule changes could add £1m in annual costs for car clubs, most of it falling on Zipcar. The company is thought to operate nearly 3,000 of the UK’s 5,300 shared vehicles.
A spokesperson for Sadiq Khan said the mayor recognises the role car clubs can play in reducing private car ownership, and confirmed that electric car-club vehicles with a dedicated parking bay inside the congestion charge zone will get a full discount from January.
Richard Dilks, chief executive of CoMoUK, said the closure highlights the UK’s lack of supportive policy for shared transport. The UK currently has just 0.7 shared cars per 10,000 people, compared with 2.2 in Germany and 4.4 in Switzerland. “People rely on these services. If they disappear, it’s a significant blow,” he said. The charity counted 328,000 car-club users in the UK in March and warns many may now feel forced to buy private cars.
Zipcar was founded in 2000 in Cambridge, Massachusetts, and bought by Avis Budget in 2013 for $491m (£371m). It still operates in 25 US states and three Canadian cities. The proposed UK shutdown follows an £11.7m loss in 2024.
Zipcar says it will honour all existing bookings, including those over Christmas. Customers with reservations going into the new year will be contacted, and paying subscribers will receive refunds for any period after 31 December.
Car-sharing services grew quickly during the pandemic as companies like Zipcar, Enterprise Car Club and Share Now offered app-based hourly rentals, while platforms such as Hiyacar, Turo and Getaround let people rent out their neighbours’ cars. But running a dedicated fleet has proved expensive, with high servicing costs for vehicles scattered across cities.
Zipcar was an early adopter of the “flex” model in London, letting drivers pick up and drop off cars almost anywhere within set zones, in addition to vehicles with dedicated bays. Car-sharing is widely viewed as more environmentally friendly because it reduces the need to manufacture a car for every household.
An Avis Budget spokesperson said the UK proposal is part of a wider international restructure designed to make the business more efficient and sustainable. They confirmed that all other Zipcar markets remain fully operational and unaffected.
