Daimler and BMW say they are combining their car-sharing businesses into a joint venture, with equal shares for each firm, to better compete with Silicon Valley
Jack Ewing / New York Times :
Context & Ripple Effects
This announcement is the formalization of a consolidation BMW had been preparing for weeks: its February buyout of Sixt's 50% stake in DriveNow for €209M removed the last outside shareholder standing between the two German car-sharing fleets. With equal ownership, Daimler's Car2Go and BMW's DriveNow become one business aimed squarely at Silicon Valley's ride-hailing and sharing platforms.
The move also fits a broader pattern in the corpus of legacy automakers banding together rather than fighting alone — Fiat Chrysler had already joined BMW's autonomous partnership with Intel and Mobileye, and Daimler separately turned to Geely for a premium ride-hailing push in China. Within a year the car-sharing tie-up would widen into five merged joint ventures spanning car-sharing, ride-hailing, and multimodal services.
First-order effects
- Car2Go and DriveNow users now sit inside one equally owned venture, ending direct competition between the two largest European factory-backed car-sharing fleets in overlapping cities.
Second-order effects
- GM, which has been testing its own car-sharing service in Manhattan against Zipcar and Uber, faces a consolidated European rival with two automakers' fleets behind it instead of one.
- Uber, Lyft, and Zipcar lose the ability to play the German incumbents against each other on city-by-city permits and pricing.
Third-order effects
- If the structure holds — and the later shutdown of BMW's standalone ReachNow service in Seattle and Portland suggests consolidation over expansion — automaker mobility arms survive only as pooled ventures with scale, not as national side projects.
- The same alliance logic extends upstream: shared fleets are the natural deployment ground for the autonomous systems BMW is co-developing with Intel, Mobileye, and FCA, making the JV a future customer for driverless technology rather than just a rental operator.
The trend: Legacy automakers are pooling their mobility services into jointly owned ventures because none can match Silicon Valley platform economics alone.