DriveNow and car2go merger to complete next year
10 December 2018
10 December 2018
Daimler and BMW have announced that their merged DriveNow and car2go scheme will begin operations in 2019.
The two groups have seen their new business approved by the European Commission, although talks are continuing with US antitrust authorities. Completion of the transaction, which was originally planned for 2018 and continues to be pursued by both partners, can no longer be achieved in the remaining weeks of this year.
Daimler has said that in this context, the expected significant positive valuation and earnings effects at Daimler Financial Services will be realised in 2019. Accordingly, the earnings forecast for the Daimler Financial Services division has been reduced for 2018. The division now expects EBIT to be significantly lower than in the previous year. The forecast for the Daimler Group’s EBIT in the 2018 financial year remains unaffected and unchanged. The carmaker adds that as previously announced, the transaction will not have any cash-flow impact on the industrial business.
In a statement, Daimler adds: ′With their joint venture, Daimler AG and BMW Group plan to combine their mobility services in the fields of car sharing, ride-hailing, parking, charging and multimodality, and to create one of the leading providers of innovative mobility services. Both automobile manufacturers want to shape the future of mobility to offer their customers unique experiences and to support partners such as cities and municipalities along the way to achieving sustainable urban mobility. In the future, customers will have a holistic, intelligent and seamlessly linked ecosystem of mobility services at their disposal at the touch of a button. In this way, the two partners are addressing the challenges of urban mobility as well as customers’ requirements and, together with cities, municipalities and other interest groups, are helping to improve the quality of life in metropolises.’
Daimler bought out car rental firm Europcar’s share of its car2go business last year, while BMW bought Sixt out of its DriveNow car-sharing service. Following these transactions, the companies announced the merger, hoping to take on services such as Uber and Waymo and build a large European car-share platform.
Sixt has also announced plans to build a car-sharing platform, investing the money it made from the sale of DriveNow. All these companies are hoping to take advantage of a shift away from traditional car ownership in the automotive market, with younger people more likely to use ride-hailing to get to their destinations.