DETROIT - Drivers like Al McWilliams increasingly concern the auto industry.

McWilliams is part of a growing community of people who don't own a car and don't want to. He has no monthly car payment. He doesn't pay for insurance or gas or parking fees.

But for $125 a year and less than $10 an hour, McWilliams still has all the wheels he needs and the gas to fuel them. He just whips out his ZipCard and heads for one of two lots in downtown Ann Arbor, Mich., to use a Toyota Matrix or Scion xD.

"I'm saving $5,000 a year easy, plus gas," said the single 29-year-old founder of Quack Media, a multimedia marketing service based in the college town.

McWilliams is one of 325,000 members of Zipcar, a company leading a car-sharing phenomenon across the United States. Nonprofits such as I-Go in Chicago, City CarShare in San Francisco and Philly CarShare in the Philadelphia area offer similar services.

Demand for short-term wheels is growing so fast in these frugal times that rental-car heavyweights Hertz and Enterprise also are jumping into the business.

Ford Executive Chairman Bill Ford told Fortune magazine that car-sharing is a sign of changes in the auto industry.

"The future of transportation will be a blend of things like Zipcar, public transportation and private car ownership," he said in an August issue of the magazine. "Not only do I not fear that, but I think it's a great opportunity for us to participate in the changing nature of car ownership."

Car sharing lets drivers save cash while helping the environment.

Ten years ago, Jan Culbertson, an architect living in Ann Arbor, would have been the customer that BMW, Mercedes-Benz or Lexus took for granted. But she might not be in the future.

Today she is a senior principal with A3C Collaborative Architecture and one of 1,400 Zipcar members in Ann Arbor.

The car-sharing service has increased its Ann Arbor membership by 78 percent in the last year. The company has studied expanding into Michigan State University and East Lansing, but a spokesman declined to comment on those plans.

Culbertson said she checks out a Zipcar only three times a month - usually when she has meetings - and that just knowing it is there has changed her commuting life. Most days, she takes the bus to her downtown Ann Arbor office.

"Zipcar's provided that missing link that allows people to change their energy use," Culbertson said. "The first thing I did was give up my $125-a-month parking pass."

The cost of that pass just went up to $130 a month.

Zipcar, headquartered in Cambridge, Mass., acquired rival Flexcar in October 2007 and is generating about $130 million in annual sales and growing at 30 percent a year. Now Hertz, Enterprise and U-Haul want in on the action, and various nonprofit competitors have built loyal customer bases in the Chicago, San Francisco and Philadelphia areas.

Zipcar Chief Executive Officer Scott Griffith estimated that demand for car-sharing eventually could generate more than $5 billion in annual revenue industry-wide.

Although it remains to be seen whether the trend will fizzle out, the services are gaining popularity as consumers seek out more affordable means of transportation during tough economic times.

For a $25 application fee and $50 annual membership fee ($35 for University of Michigan students, faculty and staff), Ann Arbor residents get a green, magnetized card that gives them access to one of four cars in the City of Ann Arbor's Zipcar fleet and 15 vehicles managed by the university's parking and transportation service.

Hourly rates are $8 an hour during the week and $9 an hour on the weekend.

Because the payment covers gas and insurance, members must have unblemished driving records. Zipcar screens each applicant's insurance record and won't hesitate to reject high-risk drivers, said Nancy Shore, director of Ann Arbor's GetDowntown program for the Downtown Development Authority.

Drivers may not smoke in the cars, use them to taxi others or deliver pizzas or other products. They also must return them to the designated parking spot as clean as they found them.

To use the cars, drivers swipe a card across a bar code reader in the front windshield, which opens the driver's door. A new iPhone application also can work.

The car comes equipped with a gas credit card in the glove compartment. Members must leave at least a quarter-tank.

Each vehicle displays Zipcar's green logo on the passenger's door and a name posted in the lower left corner of the rear windshield. The downtown Ann Arbor cars are Miller, Detroit, Dearborn and Mitten.

So far, Detroit's automakers haven't made strong gains in selling cars to car-sharing services, which lean toward fuel-efficient models, especially hybrids.

"Zipcar is a membership-driven organization, and 80% of members said they want to drive hybrids," said Zipcar spokesman John Williams. "The cars we buy nationally reflect what our members tell us they like."

Ann Arbor's Zipcar service, Shore said, has "four vehicles, two Toyota Matrixes and two Scion xDs, and we are at the point where we may need to add a vehicle."

Zipcar is likely to add two this fall.

There are 15 vehicles in the U-M fleet, said Grant Winston, who manages it for the university parking and transportation service. The university fleet also is dominated by Toyota, Honda and Mini, although there are a couple Ford Escapes. Winston said the university and city want to add more domestic brand cars.

Though the car-sharing business model has leaned heavily on college towns, much of the growth is now coming in large cities, including New York, Boston, Chicago, Minneapolis and Washington.

"Half of our vehicles are hybrids," said Sharon Feigon, who is CEO of Chicago-based I-GO, a nonprofit car-sharing service with 200 cars serving 14,000 members in the city and the suburbs of Evanston and Oak Park. "Remember: We pay for the gas, so we will always be partial to fuel-efficient and low-emission vehicles."

(c) 2009, Detroit Free Press.

Distributed by McClatchy-Tribune Information Services.