Car-sharing services face moment of truth

Car-sharing services provided by companies such as Gofun Chuxing launched by Beijing Shouqi Group and Car2go under the automobile giant Daimler AG are striving for a place in China's burgeoning sharing economy. But they will encounter disappointment unless they avoid or remove the costly speed bumps ahead.

The sharing cars, mostly powered by electricity and in good condition, can be ready for first-time users in minutes once they finish the required registration via the service apps. In some cases they cost even less than taking a cab. For example, Gofun has 1,100 cars in Beijing, with more joining its fleet once its application for license plates is approved, and offers services for a refundable deposit of 699 yuan ($102), after which a passenger has to pay only 1 yuan per kilometer and 0.1 yuan per minute for a ride.

Traditional car-rental services, on the other hand, charge on a daily basis - which means short-distance commuters are not likely to apply for them - and they are often more expensive.