Zipcar UK to shut operations ahead of new London EV Congestion Charge
Zipcar has reached the end of the road in the UK after its US owner pulled the plug on operations in the run up to the introduction of fresh London Congestion Charges for electric vehicles.
The car hire business has begun a formal consultation with employees in the UK and will stop taking new bookings beyond the end of the year, according to a company statement, in a move likely to lead to dozens of job losses.
In an emailed message to customers, Zipcar UK general manager James Taylor said: “I’m writing to let you know that we are proposing to cease the UK operations of Zipcar and have today started formal consultation with our UK employees.
”We will temporarily suspend bookings, pending the outcome of this consultation.
“This means it will not be possible to make any new bookings beyond 31 December, 2025, pending the outcome of the consultation.”
Zipcar’s losses widen as sales fall
Zipcar’s losses skyrocketed to £11.7m in 2024 compared to just £364,000 the previous year, while revenue slipped from £51m to £47m.
“External cost pressures continued to negatively impact the company. Whilst there was some improvement in fuel prices, electricity costs remained high throughout 2024,” the firm said in its accounts, published last month.
“This particularly affected the company due to the size of the electric fleet and the fact that fuel costs are included in the cost of the rental.
“Resale market values continued to be challenging, which also drove higher costs. Year on year increases in the cost of motor insurance also placed further pressures on costs.”
Zipcar did not set out why it was withdrawing from the UK, but the suspension of operations coincides with the decision by London Mayor Sadiq Khan to extend the Congestion Charge to electric vehicles, a move that would have been likely to deal a hammer blow to the firm’s electric fleet.
The charge, from which EVs were previously exempt, will mean drivers will face a £13.50 daily charge from the beginning of next year.
Zipcar UK had 71 full time staff in 2024, a fall on the 92 staff the previous year.
The firm was founded in Cambridge, Massachusetts, and was listed on the Nasdaq before being acquired by Avis for $500m.