Zipcar is preparing to withdraw from the UK after its US owner decided to cease operations ahead of the introduction of expanded congestion charging in London, which will apply to electric vehicles for the first time from next year.
The car-sharing company has begun a formal consultation with its UK workforce and suspended future bookings, a move that is expected to result in significant job losses. Pending the outcome of the consultation, Zipcar will no longer accept new reservations beyond December 31, 2025.
In an email to customers, James Taylor, general manager of Zipcar UK, wrote: “I am writing to inform you that we are proposing to cease Zipcar’s UK operations and have today commenced formal consultations with our UK staff. We will be temporarily suspending bookings pending the outcome of this consultation.”
The decision follows a difficult year for the company. Zipcar’s losses in the UK rose to £11.7 million in 2024, compared to just £364,000 the year before. Sales also fell from £51 million to £47 million.
In its most recent financial statements, the company cited “external cost pressures,” including persistently high electricity prices, which had a disproportionate impact on its large electric fleet, whose charging costs are bundled into rental prices. A weak vehicle resale market and rising vehicle insurance premiums led to further financial stress.
Although Zipcar has not explicitly linked its exit to impending policy changes, the timing coincides with Sadiq Khan’s decision to extend congestion charging to electric vehicles. From January 2026, electric vehicles will no longer be exempt from tax, meaning Zipcar’s electric fleet would incur a daily charge of £13.50 – a shift that is expected to significantly increase operating costs for the company.
The company employed 71 full-time employees in 2024, up from 92 the previous year.
Zipcar was founded in Cambridge, Massachusetts and became a pioneer of urban car sharing. It was listed on Nasdaq before being acquired by Avis in a $500 million deal. The withdrawal from the UK marks the end of almost two decades of operations in London, where the company once positioned itself as a major alternative to private car ownership.
