BMW’s Car-Sharing Service Is About to Hit an Important Milestone

Courtesy of BMW Group

In less than a week, BMW Group’s U.S.-based car-sharing service ReachNow will hit an important milestone and start operating in Portland, its second city after launching in Seattle earlier this year.

The Portland service will officially kick off Sept. 19. However, the first residents to join the service will be eligible to start test driving the service during a two-week preview drive that begins Tuesday.

ReachNow will announce an expansion to at least one more U.S. city before the end of the year, a BMW spokesman said Thursday without providing more details. The company has said in the past that it wants to eventually establish service in 10 cities in North America.

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Expanding into a second city might seem insignificant compared to other larger car-sharing services like Daimler’s Car2go. But for BMW it’s validation that its latest attempt to break into the U.S. car-sharing market might just work. Still, it faces considerable competition. Car2go as well as Getaround, Turo, and Zipcar—all related services that could compete with ReachNow’s business model—are well established in Portland.

ReachNow is a reboot of BMW’s car-sharing service called DriveNow—a joint venture between the German automaker and rental car company Sixt SE—that launched in Berlin five years ago. By the end of 2015, DriveNow had 580,000 registered users throughout Europe. However, its entry into the U.S. market didn’t go so smoothly.

The company set up shop in San Francisco in 2012 and soon discovered that its business model—a free-floating service allowing vehicles to be picked up and left anywhere within a designated operating area—was in direct conflict with the parking and car-sharing regulations in the city. The service shutdown on November 2, 2015.

BMW gave the U.S. car-sharing service a new name, dropped its joint venture partner Sixt, and added a new software platform from San Francisco-based startup RideCell. BMW’s venture capital arm has invested in RideCell, which has developed software designed to help companies, mass transit agencies, and car-sharing services manage vehicles.

ReachNow, which is headquartered in Seattle, has been well received in Seattle, a BMW spokesman said.

The service launched in Seattle with 370 Mini and BMW brand vehicles. Within the first weeks of operation, more than 13,000 residents signed up. Due to demand, the company expanded its home area—where the cars can be used and parked in any public space—added service to Seattle-Tacoma International Airport, and increased the number of vehicles on the road to 520.

ReachNow vehicles are charged at a rate of $0.49 cents for each minute the vehicle is used, and $0.30 cents per minute while parked. Customers will be charged a one-time $39 registration fee.

For a limited time, ReachNow will charge Portland residents $0.41 (cents) for each minute the vehicle is used and registration is free. ReachNow says it will automatically cap pricing at three different tiers: $50 for up to three hours, $80 for up to 12 hours, and $110 for up to 24 hours.

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