Peugeot is planning to increase pay-as-you-go car hire scheme

Peugeot is one of a number of auto manufacturers establishing schemes to give people access to a car without the cost of ownership. The brand seeks to distinguish its "Mu by Peugeot" operation from competitors by offering different types of vehicles. Mu customers can rent Peugeot cars, electric vehicles, work vans, or even scooters and bicycles, by the hour or day.

"Our business model makes us a pioneer and our competitors are watching us closely," said Pierre Bugeya, head of the Mu program for Peugeot's marketing division.

BMW and Daimler's Smart microcar subsidiary are also rivalling for a share of the blossoming car-sharing market.

Smart operates its Car2Go car sharing scheme in Ulm, Germany, and Austin, Texas. In October, BMW presented a 12-month pilot car-sharing program in Munich, Germany, that allows customers to hire vehicles from its model range by the hour.

Joachim Schmidt, Daimler's sales and marketing chief, said the company will start Car2Go in Hamburg, Germany, in April and will slowly expand the scheme in the next two or three years. "We are in discussions with 10 cities in Europe and North America, one of which is London," he said.

According to Frost & Sullivan, the number of people using pay-as-you-go car sharing services is expected to grow to 5.5 million in Europe and 4.4 million in North America by 2016.