Finding dependable transportation can be tough for cash-strapped folks such as students. Buying a new car can be even trickier for these people. This lack of new cars on college campuses has got Zipcar and Bill Ford Jr.’s Fontinalis Partners LLC to join forces and give cash to Wheelz Inc.
Zipcar, a car-sharing company, and Fontinalis are investing $13.7 million in Wheelz, a peer-to-peer car-sharing company, so that more financially-challenged students will be able to take advantage of various car-sharing plans within needing student car loans.
Though car-sharing may seem odd at first thought, the idea behind it couldn’t be simpler. Car owners are able to sign up with Wheelz and earn some cash each time their car is borrowed, while wheel-less souls can pay to borrow cars for short stints of time.
While Zipcar is similar to Wheelz in that it lends out or rents cars for short periods of time, its business model is different since the cars it manages belong to the company.
When the process rolls along as designed, it is fine example of the free market at work. Car owners win by earning cash. Students needing to do some grocery shopping, visit a far flung friend or go on a date win by gaining access to a car when they may otherwise not be able to. Also, this type of lending spreads the cost of car ownership over a wide base, which means auto dealers win as well.