Toyota, Volkswagen, General Motors Foresee Huge Profit in Car Sharing; Too Early To Assume Potential Analyst Says

Car ride-sharing companies are investing more in their business, attracted by the potential in earning enormous profit from billions of cars operating on roads all over the world.

An average car is unused 95 percent of the time and slowly becomes a depreciating asset. However, huge amount of money could be gained for the right business that can utilize these average cars. The brands Toyota, General Motors and Volkswagen are all in an investment race. The ride-and-share business is an incentive for car companies without the fear of non-dominant individual car ownership in the world of business.

Car business is greatly changing its judgement of investment value as told by Laura Lembke, Morgan Stanley analyst. Lembke stated that over 80 million international car sales can bring in $1.5 million, Japan Today reported. One billion of these vehicles are a total of existing stocks, while the average cost of a mile in a trip is $1 - an estimated $10 trillion is the potential market value. This helps explain the evaluations on apps car sharing services like Uber, which is valued at $62.5 billion. A huge amount compared with the world's third top-selling auto manufacturer General Motors.

General Motors invested $500 million this year in "Lyf," ET Auto reported. Lyf is one of the top competitors in car sharing services in the United States. Recently, Toyota announced a partnership with Uber in a confidential investment. On the same day after Toyota's partnership announcement, Volkswagen invested $300 million in "Gett," a downloadable taxi app.

These Car manufacturers' decisions are questionable for Jeremy Carlson, a senior analyst of automotive technology. Carlson commented that it is too early for car makers to assume that there is a potential value in a young industry. The traditional ownership is not expected to disappear until 2035. Individual ownership remains as the leading automotive sale.