Additionally, Zip and Flex already compete with them from the user experience of “I go to a city I don’t live in, and I rent a car to get around.” With Hertz et al, it’s a daily rental. With car sharing companies it’s hourly. This is a small part of the experience, but it’s competition nonetheless.

Non-profits make sense in perhaps three cases:

1. There’s no business case to generate profit. (e.g. Amnesty International)
2. The people being served have little or no income with which to purchase the services offered. (Medicins sans Frontieres)
3. Making a profit would cause a conflict of interest with offering the right service (Hospitals)

None of those seem to apply to car rental. There’s a clear business case. The people being served can afford the service, Finally, if there is effective competition in the market, then businesses have to provide good service or watch their customers go elsewhere. Of course if businesses can collude and merge rather than compete to offer good service, then the non-profit may be the preferred solution. However, overall I’d rather see competing for-profits in this space than non-profit motivated charities.

Zip+Flex probably think that by merging, they will have more car, and (network effect…) they will be more attractive, and effectively kill City Car Share. I’ll let you guess which one I think are the bad guys, and which one is the good guy :).