Ticket to Ride
Gas prices this high for this long? It's downright uncomfortable. In fact, it's enough to get consumers to change their behavior. Rising prices have many consumers turning to alternatives-- from car-sharing services to scooters--and entrepreneurs are reaping the rewards.
Take Scott Griffith, CEO of Zipcar Inc. based in Cambridge, Massachusetts. The $15 million car-sharing service lets its members reserve a car online by the hour or by the day, walk to the nearest pickup location and drive away--gas and insurance included. Currently, Zipcar operates in 29 cities and gets an average of 2,500 new members per month.
"The gas prices last August and September really triggered a tipping point in interest in [our service]," says Griffith, 46. "We saw an uptick of about 30 percent in membership applications, compared to the same time frame in 2004."
In fact, this January, a total of 17 car-sharing programs existed nationwide, serving nearly 92,000 members-up from 76,000--plus members in 2004--according to Susan Shaheen, a University of California, Berkeley, researcher. It's a trend that Griffith, who joined Zipcar as CEO shortly after it was founded in 1999, has anticipated for years. "The swings in gas prices are hard to predict," he says. "It has people questioning whether to change their habits."
For some, that means getting up on just two wheels--with a fuel--efficient scooter or motorcycle. Last year, Erico Motorsports founder John Beldock noticed solid sales well past the typical August drop-off: "Sales went strong through December," says Beldock, 40, who founded the Denver-based scooter and motorcycle shop in 1993.
Overall, Beldock expects to sell 800 scooters and motorcycles this year, up from last year's 650, and he plans to expand the shop's scooter rental program. "We're going to have our best year ever, for a lot of reasons," says Beldock, who predicts sales of $7.5 million this year, compared to $6 million in 2005. "Fuel is one of them."