This is one of the most anticipated ipos in a while, but what confused me is for the past decade it has never seen a profit, ZERO profits yet people still want on this IPO!!! Come on....enough of the games. Plus the article describes how much more competition exists. Zipcar revs up for initial public offering Zipcar, the giant of car sharing, has big plans as it goes public, though challenges remain ap Christina Rexrode, AP Business Writer, On Tuesday April 12, 2011, 2:48 pm EDT NEW YORK (AP) -- Zipcar Inc., the car-sharing company that rents rides for as little as an hour, is expected to get a warm reception from Wall Street for its planned initial public offering this week. Its supporters think skyrocketing gas prices will make car sharing more popular. They praise Zipcar's technological savvy and its plans for overseas expansion. Zipcar is "one of the long-awaited hot tickets in the IPO valley," said John Fitzgibbon, founder of IPOscoop.com. Investors are warming up to IPOs again after the market sputtered in 2008 and 2009. Still, Zipcar has never been profitable since it was founded in 2000. It expects to lose money again in 2011. Cars, its main expense, don't come cheap. The IPO's value would total about $125 million at the midpoint of its expected price range of $14 to $16 per share. Of that, the company expects proceeds of about $89 million, $46 million of which it plans to use to pay down debt. The company plans to trade on the Nasdaq Stock Market under the ticker ZIP. The offering is expected to price Wednesday night, with the stock to start trading Thursday. Unlike a car-rental program, Zipcar doesn't require customers to visit a store to pick up keys. Rather, members pay a $60 annual fee and $25 application fee to join and get a keycard. Cars are parked throughout their city. Members go online to reserve a car nearby, and their keycard unlocks it. Hourly rates vary but are usually less than $10. Customers don't pay for gas. Although Zipcar says it has identified dozens more cities where it could succeed, there are questions about just how far it can expand. Its model works best in densely populated areas where many residents don't own cars. Zipcar, based in Cambridge, Mass., is a giant among U.S. car-sharing programs, operating in 14 cities. Most of its competitors serve just one. It bought it major direct competitor, Flexcar, in 2007. However, rental car companies Enterprise and Hertz have created their own car-sharing programs. Zipcar's smaller rivals also recently formed an alliance called The CarSharing Association. Zipcar is quickly expanding on college campuses with cars at 230 colleges, up from 150 in June. Last year, it moved overseas by buying U.K. rival Streetcar Ltd. Zipcar says it has pinpointed more than 100 metro areas worldwide and hundreds more colleges as attractive markets. "If it works, then everyone's going to make a lot of money," rental-car analyst Michael Millman said. "If it doesn't, I suppose they can always contract to be smaller and profitable." Millman said he's not sure if Zipcar's losses so far are a concern. "I would assume that if they wanted to have a profit, they could have a profit," he said, "but then they might have to give up or delay growth." Investment groups including Norwegian investment firm Smedvig Capital AS and a range of individual investors are also selling shares and will get part of the IPO proceeds. Zipcar gets praise for its use of technology: For example, members can get text messages when their reservation is almost up and learn whether they can extend the rental. The company counts two tech celebrities on its board of directors, AOL co-founder Steve Case and former eBay CEO Meg Whitman. Skyrocketing gas prices may hurt Zipcar in the short term, said Dave Brook, a consultant who founded Carsharing Portland in 1998. But they could eventually drum up interest, he said. Brook thinks the tipping point is when car owners drive less than 5,000 miles a year. "That's when you start thinking, 'I'm spending a lot of money on this car and not getting a whole lot of value out of it.'"