App sale

Stellantis buys car-sharing company as BMW and Mercedes go a different route

  • Stellantis will add 3.4 million car-sharing customers
  • Stellantis aims to increase revenue from mobility services
  • BMW and Mercedes JV pulled out of North America in 2019

FRANKFURT/MILAN, May 3 (Reuters) – Stellantis (STLA.MI) has agreed to buy the Share Now car-sharing business from BMW (BMWG.DE) and Mercedes-Benz (MBGn.DE) as the two German groups focus more on the software part of their mobility alliance.

Created last year by the merger of Fiat Chrysler and carmaker Peugeot PSA, Stellantis aims to become a global leader in car-sharing, using the acquisition announced on Tuesday to expand its existing business in the region.

The deal reflects different approaches from automakers trying to tap into new revenue streams beyond vehicle sales, particularly in the developing field of mobility services.

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“We think this reinforces our belief that high-end OEMs (manufacturers) like BMW and Mercedes will focus on private car ownership and less on fleet services,” said Royal Bank of Canada analyst Tom Narayan. .

“Conversely, it makes sense for volume players like Stellantis to seek out these alternative revenue streams.”

No financial details were provided for the transaction. Italian daily La Repubblica said he was worth around 100 million euros ($105 million).

In selling the division, BMW and Mercedes-Benz will focus on the two remaining parts of their mobility cooperation: Free Now, an app that allows booking cars, taxis, e-scooters and e-bikes, and the charging infrastructure reservation application. Charge now.

Brigitte Courtehoux, who heads Stellantis’ Free2move mobility division, said the deal was part of the group’s plans to boost the business’s net revenue to 700 million euros in 2025 and 2.8 billion euros. in 2030.

“We’re really going to accelerate in terms of revenue,” she said.

Stellantis said the deal would allow Free2move to add 14 major European cities and 10,000 vehicles to its current fleet of 2,500 car-sharing vehicles, gaining more than 3.4 million customers.

She added that the Free2Move fleet will not become 100% Stellantis but said “step by step we will have more and more Stellantis cars”.

Milan-listed Stellantis shares rose 2.3% at 0940 GMT, outperforming a 1% rise in the Italian blue chip index (.FTMIB).

BMW shares rose 1.8%, Mercedes shares were down 0.4%.

Share Now pulled out of the North American market in 2019 in response to high maintenance costs and what the companies then described as “the volatile state of the global mobility landscape.”

At the end of 2020, BMW CEO Oliver Zipse fueled speculation of a reorganization of the mobility services alliance with Mercedes-Benz when he signaled the possibility of bringing in new partners or a possible sale. partial. ($1 = 0.9514 euros)

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Reporting by Christoph Steitz, Christina Amann and Giulio Piovaccari; edited by Barbara Lewis and Keith Weir

Our standards: The Thomson Reuters Trust Principles.