How We Can Ingrain Car Sharing Into American Culture. With Aric Ohana

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What This Show Is All About.

Aric is the CEO/Founder of Envoy There a startup making Electric Vehicles an amenity. Ian Sumner sits downs with Aric to learn about how car sharing can be ingrained into American Culture.

Transcript

Aric Ohana 0:01
You know, what is the need of owning a vehicle, if I can push that button in that pod or, you know, whatever that might come to my front door, and I get into it and it takes me where I want to go without a driver, so the cost is pretty low and it’s even lower because it’s shared amongst, you know, communities and cities or whatever you may have. Like that’s, that’s where it goes, right? Yeah.

Ian Sumner 0:27
This week on big feet, the role car sharing has today in its place in bridging us into the future of mobility. To help me out with that

Aric Ohana.

Aric Ohana 0:42
My name is Aric Ohana I am the CEO of a company called Envoy. What we do is we provide electric car sharing to communities so we partner with large property owners of apartment complexes, offices, even hotels, the electric vehicles that can be shared by those community members. So it’s exclusive just to that property. So what we do is really provide mobility as an amenity, to these communities.

Ian Sumner 1:12
I really think what you guys are doing with envoy is really cool. Because I mean, I know like Zipcar has been around for a long time, but having it as like an amenity to an apartment or hotel and making sure like, because you guys are only doing an electric fleet, right.

Aric Ohana 1:28
That’s right. I think

Ian Sumner 1:31
it’s a really cool, unique approach. And I think it could really change sort of the landscape of transportation, which I guess is the goal, right?

Aric Ohana 1:40
Yeah. I mean, we actually came from commercial real estate. And what we saw was the convergence of mobility, energy and the built world, and they’re gonna have these huge impacts on commercial real estate. So we definitely have some forward thinking thoughts as to where it goes. But step number one by providing an amenity makes it very easy for any community to adopt. And we’re seeing really big impacts on many different levels within those communities once we place those vehicles, right. For most people, it’s our first experience with an electric vehicle, which is super important for overall adoption of electric vehicles, because there is a connotation of range anxiety. And, you know, one way to get over it, is by using the vehicle to cover your groceries, or, you know, pick up your kids. So envoys platform really enables really, to see how you could live day to day with water, if you will. So that’s one major impact as well as sustainability so that we’re focused on

Ian Sumner 2:45
and that’s a good point. So you, you you started in commercial real estate, you still consider yourself as a in commercial real estate as well. Right. So can you talk about how electric vehicles and commercial real estate how did those end up together? How do you go from one to the next?

Aric Ohana 3:02
Yeah, so we were developing a student housing complex that was actually in Texas. You know, one of the big issues and developments is cost to construct. And those costs have, you know, been increasing over the years. And building parking is extremely expensive. You know, in some cities, it could cost you know, 25, all the way up to like $75,000 per parking space to build. So any reduction on parking, we thought was super important. And we weren’t actually sitting in Texas where, you know, cars are very central there are as many cities and you know, their parking count was like one car per bedroom. And we know student housing, doesn’t need that much parking. But so we approached them with the novel idea of including car sharing within the community. And what they’ll do is reduce the amount of people that bring cars thus not eating as much parking So that was kind of the initial approach. And, you know, after that we actually reached out to Zipcar reached out to reach now and a few others, you know, kind of with the lens of a landlord that wants to lease up this building and provide, you know, value add community service, there was there was definitely a disconnect with what we were trying to accomplish, and what they said they could do. So that was the initial kind of like, Hey, you know, this is an interesting thing. So when we were actually coming up with this idea and building out the business plan. I was driving electric vehicle at the time, my co founder or he siggy. And I used to carpool essentially, to our office. And, you know, it was a big part of, you know, the business model we actually it was a fee of 500 fee and we actually launched our first properties with Fiat 500. Ease. So yeah, that can that that was automatic from the beginning. We knew that they were going to be electric vehicles within this platform from the very.

Ian Sumner 5:04
And I mean, is that just something that’s based on your experience already driving electric car? Why does an electric car lend itself more to car sharing?

Aric Ohana 5:11
Yeah, so the way you should look at it is, well, we should probably should have find the different types of shared mobility. So we’ll just make it simple in the car sharing site. So car sharing typically has station based. So you know, essentially that Zipcar, you might use the vehicle and bring it back to the same place. And then there is one way station base where you might, you know, take it from one location and drop it off at another location, but both are stations for that car sharing platform. And then there’s also floating, floating is what you’ll see like roaming around the streets and you can really drop them off anywhere around the city. That one probably has the largest operational hurdles. Station base is what we do and it’s community base station based so it only community members can use that vehicle. And it’s always been returned to that community after someone’s done with it. But one of another hurdle on the operation side is how do you feel these vehicles, typically they’ll have gas cards in them for people to fill up fuel. But these experiences not great, right? Either you have to go fill up fuel. So what we do is we install a dedicated charger, out the parking space for the vehicle, and you’re instructed to plug in the vehicle before you end the reservation. And thus, everybody gets a pretty much full charge, you know, right when they start their booking, which is, you know, I think on the operational side that is super important. And we can also get into the future of how that interacts with the built environment as well. Yeah.

Ian Sumner 6:43
And I’m very interested in getting into this future.

Before we kind of go there, I mean, so and I know this this first project that you were doing, you said it was in Texas, I know you’re based in LA and it seems like you guys have a lot of projects down there as well, right. And I mean, these are cities They’re very, I mean, most US cities, there’s not a ton, where you can really you can get or get around without a car, but I can I know in LA, like I lived down there for a couple years, and it’s, you’re very reliant on a car. And so how do we get people to actually adopt these car sharing networks? Right? How do we get people to start sharing as opposed to just having their own personal car and commuting everyday in it?

Aric Ohana 7:31
Well, the big part of it is the education. And actually the shifts in consumer, you know, needs and behaviors. So we’ve seen that, you know, now especially the younger and the millennial generation, they’re looking more to have experiences than owning things. A lot more renters a lot more plug and play scenarios like we work and you No car sharing or getting rid of vehicles all together has always been a very difficult thing to try to accomplish. But now that we have Uber lifts, we have other car sharing platforms. We have micro mobility, shared, shared micromobility. All those things provide an ability not to own a vehicle. But if you really want to convince somebody not to own a vehicle, we think there’s three pillars, right? It needs to be just as affordable or more affordable than owning a vehicle. It needs to be just as reliable. And it needs to be just as convenient as open up a collab, the keys in my pocket, I walk outside and I get in my car that’s right outside my doorstep. So if we look at mobility right now, you know, if you look at Uber Lyft, they have the convenience you push a button inside your doorstep. They have the reliability because you push a button, it’s at your doorstep and they also but they don’t have the affordability. So Like you can’t replace your car and say it’s gonna cost me less to use Uber and Lyft in non owner car, you know, car sharing what they have is the reliability, right? They also have the affordability, it’s actually cheaper than owning a car in many ways. But the convenience isn’t there, like you know of Zipcar, you know, have reached now. But for you to find one, you probably have to pull your phone, look at a map. And you might actually take need to take another piece of mobility to get to that, that vehicle. So that’s not very convenient. Combined, you know, those two services? Yeah, they’re not, they’re not so bad. They could they can meet both of those things. And that’s why we see less and less people owning cars, especially in dense urban areas. What we provide is really all three pillars, right? We’re more affordable than current Crusher, things were cheaper in many cases than reach now in the car. We’re just as reliable, and we’re super convenient. We’re at your doorstep like this is a car you know, it’s a quarter That you probably use multiple times a week. So that lends the ability not to own vehicles. And that’s somebody that’s a that’s one use case, the other use cases, I’m a family of three or a family of four. I need my big minivan to move everybody around. But I don’t need to own this second car, I can be a one car family, and I can use a car in my community or other mobility services not to own that second car. So it’s about reduction. Overall, but yeah, there, you know, there will never be probably a world that no one owns a vehicle. In the other piece of where we see it is, you know, if you want to provide a service that can span the socio economic spectrum from affordable and disadvantaged communities, all the way up to luxury. It’s probably not a one size fits all business model. Like for instance, like public transit, you’re typically in most cities, you’re gonna get mainly a certain, you know, segment of that population. And same with Zipcar, right, you’re getting a certain segment of that population. Uber provides Uber x and Uber Luxe and different levels about the try that differentiate and provide that service. But that’s kind of needed if you want to get full adoption. So what we do is we actually match the car type to the community type. So you know, we have vehicles at affordable housing and disadvantaged communities and student housing, senior housing, luxury and even kind of like market rate, both in suburban and urban markets. So you know, putting a Volkswagen e golf in a disadvantaged community and putting a Tesla Model X in a luxury community. You know, that’s how we can differentiate and provide, you know, the several same level high level service throughout that spectrum. And just provide the cost point that that individuals actually need makes sense or the luxury They’re trying. Yeah.

Ian Sumner 12:00
Um, I so I mean, do you think America can get behind this type of transportation? Well, do you think we can disconnect from our cars? Right? Yeah, I

Aric Ohana 12:11
think, well, you’re never gonna disconnect from mobility, right? I just think the form of mobility might change. Right? So personally owned vehicles is what we know now. And there’s a couple different ways to own them, you can be semi finance them. Now we’re seeing with car sharing, and subscription. So those are different kind of business models to obtain mobility. But you know, what is the need of owning a vehicle, if I can push that button in that pod, or, you know, whatever that might come to my front door, and I get into it, and it takes me where I want to go without a driver. So the cost is pretty low. And it’s even lower because it’s shared amongst, you know, communities and cities or whatever we may have. Like that’s, that’s where it goes, right? Yeah.

Ian Sumner 12:57
Gotcha.

And so

Yeah, I guess that kind of transitions us a little bit more into the future of where you see this industry going. And is that so you’re convinced that that’s gonna be autonomous cars. And that’s going to be no one or very few people owning private vehicles like what does that future look like?

Aric Ohana 13:21
I think they’re autonomous cars, but people own personal vehicles also, I mean, the person that buys a Rolls Royce today will more than likely have, you know, their personal autonomous Rolls Royce in the future. But I think the way we’re going to look at moving around cities is really, we’re going to pretty much aggregate all our mobility solutions under one platform. So you’re going to say I’m going to go from point A to point B. And just like in Google Maps, now you can see different modes and how long did it take you, but we’re going to connect those. So you know, it might be walking or how taking an autonomous vehicle to, you know, a train station I take that train across town and then getting off the train station taking, you know that that autonomous pod to you know where you’re going. And that that could all be under one umbrella with connected services, all different service providers, but connecting that user experience through mobility, I mean, that would lend yourself not to own a vehicle and you know, living in LA, you know, just looking at the Expo Line down the street here in culver city that can take you all the way to downtown or the Santa Monica. You know, you can see how that can start making sense if we can pull those types of abilities together. And there we’ll see even more of a reduction in vehicles owned. But at the same time, somebody that’s going from point A to point B, they’re going to have that option. They can take that the public transit or, you know, whatever that might be, or they could take an autonomous vehicle all the way to that destination, and each one will have a different price point. You know, I think that’s how we’ll we’ll see kind of Future moving around the city.

Ian Sumner 15:01
Yeah, I think bringing public transit into the picture is important as well, right? Because it takes other mobility infrastructure to replace some of the car trips in order to have it in order to allow people to go towards a car sharing. Culture,

Aric Ohana 15:20
right. Yeah, I mean public transit. Well, public transit, there is a need for it, and especially in many cities in God should never go away. But there’s no question that public transit has struggled with profitability. Usually there are costs for a city versus a way to make money or even breakeven. So they’re always looking for more riders and users. So and I think when you get less and less people owning vehicles and you make, you know, public transfer, more technology oriented, you know, that’s where you start seeing ridership. trips go up, and we’re starting to see that more and more. It’ll be interesting to see what, you know, the post COVID era looks like when it comes to public transit and also shared mobility in general. Yeah.

Ian Sumner 16:12
Gotcha. And so, okay, so I guess so the average car sits about unused about 90% of the time for my understanding, right. And so you’re providing a car for that, maybe 10% that people need. And ideally, people aren’t feeling constricted because there’s other types of mobility accessible to them as well, right? It all kind of goes hand in hand to build a network of access, right?

Aric Ohana 16:40
Yeah, that’s right. So, you know, if all of our cars are rented, somebody that doesn’t own a car is not going to feel abandoned. You know, that day, they’ll probably take an Uber or figure out some other mode of mobility, but that’s now available in most most cities, most places we live in.

Ian Sumner 16:59
So And what are some of the cities that you’re sort of targeting? to begin with? Most of our cars currently are in Northern California in Southern California. And there’s a lot of good reasons for that.

Aric Ohana 17:12
We also were awarded a grant from the California Energy Commission, and did a partnership with electrify America. In both those programs, we deployed vehicles in apartment complexes. And we committed to having a minimum of 75% or around 75%, I should say, of those products, those communities have to be within a low income or just venge community census tract. So we’ve been super excited about that. We pretty much have fully launched that program. And in many of those communities, they’ve been running already for over a year. But so most of our vehicles are currently in Westlands.

Ian Sumner 17:52
What sort of sustainability or yet what sort of impact do you see carsharing hat

Sorry, I cannot talk this morning.

Aric Ohana 18:03
It’s a little funny.

Ian Sumner 18:05
It’s one of those days, I’m basically I’m trying to figure out what the impact carsharing can have on climate change, right sort of big picture. Why do we need this? why it’s important and what impact it’s having now and where that’s ideally going to go in the future.

Aric Ohana 18:23
So in regards to climate change, and just pollution from vehicles, you know, we’re, like I was saying, I’m sitting in an office alone, because, you know, everybody is working remotely due to Coronavirus, and it’s a very strange time. But there’s a lot of I don’t know, I think there’s a lot of silver lining if we kind of reflect on what’s going on here. And one of the most impactful ones is just seeing the clear skies over Los Angeles. And even in cities in China, from everybody staying home and not driving their vehicles and all sudden the skies clear. So anybody that says That pollution is not an impactful thing on health and environment. You know, at this point, you can prove it, you got everybody off the road for a couple of weeks in the skies cleared up. So car sharing plays an important role in that. We, for every car share vehicle that’s out there, studies have shown that that’s reduces the amount of car ownership by 10. So we’re taking 10 vehicles off for every one vehicle that’s put into car sharing. So that is a major reduction, and also car sharing. And using electric vehicles, I think that is probably the most important component of it. And what that does is gives a real opportunity for anybody to make that change to an electric vehicle. So I think the combination of helping reduce the amount of car ownership but also giving people an avenue of showing them how electric vehicle in fundamental life and giving them the infrastructure to do so, I think are two key components of how car sharing, at least on our business model can impact climate change.

Ian Sumner 20:05
That is amazing. 10 cars off the road for one.

car sharing ride sharing car.

Aric Ohana 20:13
That is, yeah, so there’s studies from a group in Berkeley. Yeah. And most recent reports, I think is like 10 to 12. Wow. And it makes sense. You quoted that course. Support 90% of the time. I think actually, most studies show like 95% of time. So we’ve literally, you know, it’s even more like you’re literally using, it’s your second highest cost of living, right, first rent or mortgage. And then, you know, personal car ownership, your second highest cost of living, and you use it only 5% of the time. It’s a huge waste. Yeah, it’s huge impact. Yeah, no question about it. And, you know, as we become more socially conscious, you know, and individuals like you who are measuring their carbon footprints or, you know, do more recycling or whatever, like, extra level we can do as long as we, you know, keep, you know, doing that. I think we’re going to see a much cleaner future. Yeah.

Ian Sumner 21:15
Last couple questions. Um, I was wondering how the efficiency of a car sharing program compares to a ride sharing program. So what you’re doing versus like, what Uber is doing?

Aric Ohana 21:32
Yeah, well, currently, they’re very different, right? Uber will bring a card you with a driver, and that driver will take you somewhere and drop you off our service. We pretty much you have a key on your phone, and you unlock the car and you drive yourself where you’re going. And then you bring it back and your reservation when you get back home. So right now they’re completely different services. In the autonomous future, they probably converge. But you know, all all mobility goes like rental cars, Uber lifts, our services and other car sharing all become the same business model, once vehicles become autonomous,

Ian Sumner 22:15
Hmm, that’s a really interesting way to kind of look at because I was considering them two very different approaches to mobility. But yeah, I it makes sense that they would kind of converge. Ideally, we get to that point, right.

So what if and then the question is,

Aric Ohana 22:36
who owns those vehicles? So in that, you know, situation does Uber own their vehicles? Or does Ford and BMW launch their own programs with only Ford or BMW Vehicles that come pick and move people around? You know, do you have a subscription to BMW because you like BMW more and only BMW, come pick you up? You know, I think the business models will be it’ll be interesting to see Where those business models go? You know, we believe, if we look at, you know, the industry, that’s probably the most poised to profit and find new business channels in mobility, its commercial real estate owners. You know, they have the parking infrastructure, that can you park and charge these vehicles, they have the tenant base to use these vehicles. So that’s kind of the role that we’re playing. We partner with commercial owners, and say, you know, we’re going to put these vehicles in your property, people are going to use them, your tenants are going to use them. We’re going to collect this data, this data is and enable you to go to the city and ask for a parking reduction or a density bonus for your next development. But we’re also going to find, you know, clear, sustainable business model that can enable you guys to create a business business channel from mobility in the infrastructure you already have in place.

Ian Sumner 23:59
Yeah. So I guess the ideal setup is for a daily commute, either by bike or public transit. And for those runs where I absolutely need a car, some sort of car sharing program, hopefully electric.

Aric Ohana 24:14
But you know, it’s interesting, we look at it the same way and we put these cars where people live work and also hotels where they stay and aren’t Yeah, that’s the whole idea in with residential apartment buildings. You know, we provide a messaging and we talk about a car free living or car light living, you don’t need two cars, you could use one car, here’s envoy or maybe you don’t even need to own a car at all. And then we also put these vehicles in office buildings and for those members, you know, we are messaging through property management and the ownership. You know, you don’t need to take a single occupancy vehicle to commute to work, you know, get to work using carpool rideshare walking, biking public transit, but if you have a business meeting Or a personal errand or anything you need to do during the day, there’s cars available at your office building that you can use during that period of time. Right. So that’s very much aligned with how we position our business.

Ian Sumner 25:14
Gotcha. And I guess it’s also a good question. I mean, you have statistics, at least about we know where these cars are going and how often they’re being used and stuff. Where are most people going with these cars? Are they going to work on that all day? I’m assuming they’re not doing daily commutes on them. Is it a grocery store? Like what are people what are these mainly being used for?

Aric Ohana 25:33
So 15% of all our bookings right now are daily rentals. So you can book the car for entire day. So majority of them are pay per use, right? So you’re using it for you can rent it, you know, for 15 minutes at a minimum, right? So 15 minutes to a few hours. In most of those cases, individuals are using them to go get groceries. pick their kids up from school. You know, it’s funny we have, we have a running campaign where you can get like a promo code. If you just say, you know, fill in the blank I use envoy for. And it’s you know, everything that you somebody will use a personal car for. But why this is impactful is in many of these communities. People can’t afford a car, they have unreliable transportation and they live in a food desert with no grocery store within a few miles, right. So there’s no public transit. There’s no grocery stores. So you know, that’s where the service is really impactful. But people use these vehicles for anything you would use a personal car for concluding that road trip.

Ian Sumner 26:42
Good to know. And I guess just realized, last, just because I’m kind of curious about it. I mean, do you see these cars like are they in use a higher percentage of time than a normal? The normal like 90 95%

Aric Ohana 26:58
Yeah.

Ian Sumner 27:00
Yeah. What does that look like then?

Aric Ohana 27:02
Yeah, I mean, and that’s the goal, right? I mean, if we don’t get utilization, I think the industry, the market, like so Zipcar and other car sharing companies, you know, 20 25% utilization is what they’re aiming for. We’ve seen up to 45% utilization in some of our buildings. And, you know, I think we’re averaging right now about 15%. But a lot of the properties and a lot of communities we just launched in the last six months. So there’s definitely an adoption period of three or four months to get season. But on average, we’re about 15%. But we definitely have a lot of properties that are seeing well over kind of the industry average as well. So that’s great.

Ian Sumner 27:44
That’s really cool. I guess that really goes into the convenience factor and why you guys are kind of targeting that pillar of those three that you identified earlier.

Aric Ohana 27:52
That’s right. I think like I think 90% of our users are repeat users. So meaning they booked more than once. Yeah, we have, you know, we have users that have rented the cars over 400 times in the last year. This, you know, either becomes kind of like, hey, my car broke down, or it’s in the shop or have a family member in town. All those are use cases that people might use the car. Not on regular basis. But then you have the people that were using Uber and Lyft. Or their lease on the car just came up and they’re not really sure what they want to get. And they just start using it. And they just know that this becomes part of their lifestyle.

Ian Sumner 28:33
That’s phenomenal.

Anything else you kind of want to touch on before we go? That’s kind of

super thorough so far, I think so.

Aric Ohana 28:43
Yeah. I one thing I would add is kind of how like looking towards the future. This convergence of how does electrification of everything, and how does mobility electrification of mobility impact the built world And we see it as very synergetic. And we look at electric vehicles as batteries with wheels on them. So they’re, they have the ability to store energy, and they have ability to store and clean energy with solar in a building and store clean energy. But what that vehicle does, you know, if you wanted to install a stationary battery in a building, that was, you know, 93 kilowatts or whatever. It’s very costly, it’s almost as much as a car. And the service that we’re providing provides an offset for the cost of that vehicle, or that battery. But it still enables us to look at this battery as an asset for not only the building but potentially for the grid as well. So a lot of the projects that we’re focused on this year, have to do with either collecting data or doing pilots on vehicle to grid or vehicle to building technology and installing bidirectional chargers. That would enable us to take energy from the battery. Have a nice Some leaf in power, you know, a building. And you know, that’s super important, I think, you know, right now in California we produce more renewable energy than we can actually use. And either, you know, don’t use it or it gets shipped off to other states. The issue is we don’t have the ability to store it. And if we kind of look at, you know, electric vehicles that could be plugged into the grid, where they live in their apartment building or through services like ours, you now can quickly expand your storage capacity for energy. And we think that’s going to be a huge component of our business model of, you know, the general future. You know, not too far off. I’ve got to come to four times here. Hmm.

Ian Sumner 30:43
Wow, that’s, that’s a lot. A lot of really cool. Very different features.

Aric Ohana 30:49
Yeah, I mean, they all come to one future but a lot of stepping stones to get there for sure. A lot of different stepping stones. One very cool, very sustainable, very green, hopefully future. Hope we get there in time. That’s the goal.

Ian Sumner 31:06
Well, thank you so much for talking today and coming on the show.

Aric Ohana 31:07
Yeah, thank you for your questions!

Ian Sumner 31:15
Big Feet is a production of The Impact and produced by me, Ian Sumner. Music by Swaroop Pujari.

Check out our whole publication along with our other podcasts at readtheimpact.com – We’ll be back next week.

Produced By

Ian Sumner Editor In Chief The Impact
Ian Sumner

Music By

Swaroop Pujari | Music Producer @ The Impact
Swaroop Pujari

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