Volkswagen has decided to sell its WeShare car-sharing business to German startup Miles Mobility,media reported. Volkswagen wants to get out of the car-sharing business, given that the car-sharing business is largely unprofitable.
Miles will integrate WeShare’s 2,000 Volkswagen-branded electric vehicles into its fleet of mostly 9,000 combustion-engine vehicles, the companies said on Nov. 1. In addition, Miles has ordered 10,000 electric vehicles from Volkswagen, which will be delivered from next year.
Image source: WeShare
Automakers including Mercedes-Benz and BMW have been trying to turn car-sharing services into a profitable business, but the efforts have not worked. While Volkswagen believes that by 2030 about 20% of its revenue will come from subscription services and other short-term travel products, the company’s WeShare business in Germany has not worked out well.
Volkswagen Financial Services CEO Christian Dahlheim told reporters in an interview that VW decided to sell WeShare because the company realized the service could not be more profitable after 2022.
Berlin, Germany-based Miles was one of the few companies in the industry that was able to escape losses. The start-up, which is active in eight German cities and expanded to Belgium earlier this year, broke even with sales of €47 million in 2021.
Dahlheim said VW’s partnership with Miles was not exclusive, and the company could supply vehicles to other car-sharing platforms in the future. Neither party has disclosed financial information for the transaction.
Post time: Nov-03-2022