Car-share company GoGet joined a rapidly changing transport landscape when it launched in Newcastle on Tuesday.
Newcastle's love affair with the privately owned car is facing challenges due to parking scarcity and new transport options, especially in the inner-city.
The city's new private bus operator, Keolis Downer, has changed the public transport network, and City of Newcastle has commissioned the company to run a driverless bus trial in the city.
Deputy lord mayor Declan Clausen said the council's strategy was to encourage walking, cycling and public transport.
"However, I don't believe it's possible to live in Newcastle without access to a car, and car sharing provides that," he said.
"You couldn't point to any city around the world where parking is easy.
"The level of service we've come to expect in Newcastle is not realistic as the city densifies."
GoGet will start in Newcastle with 10 cars based at new apartment buildings in Wickham, but it plans to expand to on-street parking in coming months.
Its pricing plans range from $49 a year to $30 a month in subscription fees plus usage charges from $6.50 an hour and 40 cents per kilometre for fuel.
The council is working on a policy which would reserve on-street parking spots for car-share vehicles.
Cr Clausen said firms such as GoGet would have to show regularly that the spaces were being used efficiently.
Greens councillor John Mackenzie said transport alternatives such as car sharing, park-and-ride and cycleways were "inevitable", even though the city was still relatively easy to navigate by car.
"If we're late in terms of making judgments, we'll be blamed for lack of foresight," he said.
"Getting on the front foot is the right thing to do."
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