Zipcar, a car rental company, has disclosed its intention to cease operations in the UK by the end of this year. The UK general manager, James Taylor, informed customers via email that discussions are underway, leading to the temporary suspension of bookings past December 31. Taylor mentioned that Zipcar is initiating formal consultations with its UK staff and proposing to halt operations in the country.
For customers who have already reserved a car for Christmas, the service will proceed as planned. However, individuals who booked a vehicle for the New Year will be contacted by the company. Members with reservations post-December 31 will be refunded, and the cancellation fee will be waived.
Taylor emphasized that while the UK operations are proposed to cease, user accounts will remain active until a final decision is made after the consultation process. Zipcar, an American company, provides hourly and extended rentals for cars and vans through a mobile application, offering various membership plans with different monthly costs.
The reason behind the sudden closure of Zipcar’s UK operations was not disclosed. Customers interested in using Zipcar in the US can continue to do so, as the company has no plans to shut down operations in the States. However, a US membership will be required for access.
According to the company’s latest accounts, Zipcar’s UK branch had 71 employees by the end of the previous year. The accounts revealed a deepening loss of £5.7 million in 2024 due to a decline in customer trips.
In its published accounts, Zipcar attributed the increased losses to rising electricity and insurance costs, as well as a volatile market for residual values, amidst a challenging year. The company noted a substantial rise in pre-tax losses compared to the previous year, primarily driven by reduced revenue stemming from fewer trips and shorter average trip durations in 2024.
The ongoing impact of the cost-of-living crisis was also cited as a factor suppressing demand for discretionary spending, contributing to the financial difficulties faced by Zipcar.