Uber drivers can now offer rides around Boston using Zipcar vehicles, under a new agreement between the two transportation-technology companies.
Boston-based Zipcar and its parent company, Avis Budget Group, will park 20 sedans at Uber’s Dorchester office for exclusive use by Uber drivers. Drivers will be able to rent the cars on an hourly basis through Zipcar to pick up passengers.
Uber has worked with other companies to allow drivers to offer rides in rental cars, as has its rival Lyft. In Boston, Uber drivers can rent cars through Hertz and Enterprise. Uber also offers leased cars to drivers.
The Zipcar deal may require less upfront costs for those drivers who want to work only a few hours at a time. Rates for drivers will start at $12 an hour to rent the vehicles, plus a $7 monthly fee. The rental program with Hertz and Enterprise, by contrast, requires Boston drivers to take out cars for a minimum of seven days. The lease program requires an upfront payment of around $250 and weekly payments in the $100 range, according to Uber.
Neither Uber nor Zipcar is paying the other as part of the agreement, but Zipcar spokeswoman Lindsay Wester said both companies will benefit from the deal.
For Uber, the deal represents a chance to expand its driver ranks, at a time when the company has emphasized recruiting and retaining more drivers to meet passenger demand. The drivers, who are classified as independent contractors, will need to pass background checks through both the company and the state, like all other Uber drivers.
“This partnership opens the way for more people to drive when they want and earn what they need, even if they don’t own a car,” Meghan Verena Joyce, Uber’s East Coast general manager, said in a statement.
Zipcar, meanwhile, gets the chance to sign up Uber drivers as new customers. Uber drivers will pay the same monthly fee as regular Zipcar members; the $12 hourly rate for sedans, meanwhile, is around the middle of Zipcar’s offerings in Boston.
Those Zipcar rates, however, may not prove attractive to Uber drivers, said Harry Campbell, a ride-hailing industry analyst who blogs about driver issues at TheRideShareGuy.com. With the typical Boston Uber driver making about $20 an hour before expenses, drivers may consider the rental rate too steep, he said.
“I almost don’t see how $12 an hour can be economically viable for any single driver,” Campbell said.
The drivers using Zipcar would not need to pay for gas, insurance, maintenance, or other costs associated with vehicle ownership, as typical Uber drivers do. But even accounting for that difference, Campbell said, the rental costs seem high.
“You’d have to be making $25 to $30 an hour for it really to make sense,” he said. “Maybe on certain days or nights of the year, a Super Bowl or New Year’s, where earnings are going to be a lot higher, maybe that makes sense. But even then it’s really high.”
Wester, the Zipcar spokeswoman, downplayed the pricing concerns. She suggested the program could entice people who want to try out driving for Uber without making a big commitment.
“This particular partnership is unique as the commitment is minimal, and it allows people to test out the product, better understand the Uber driver experience without the more long-term commitments of car ownership,” she said. “We will continue to work with Uber to evaluate key learnings from the initial deployment.”
Boston is the first market for the Uber-Zipcar partnership. Depending on its success, it could expand to other cities.