When it comes to choosing a new car, today’s buyers have a huge array of options to consider. The majority of buyers will also have to select from an often confusing number of purchase or lease methods – each with their own specific terms, benefits and drawbacks.
Most research indicates that for the majority of buyers, the physical dealership remains a key part of this decision making process, after all, finance or leasing contracts are usually a two or three year commitment and are not to be taken on without due consideration. This trend is beginning to change however and increasingly, buyers are making more car buying decisions online.
Car subscription is a relatively new and simple way of getting a very modern car on your driveway, and one that does away with the day-to-day responsibilities of ownership or leasing. With a subscription you can have the use of a car for a relatively short period of time, from as little as a month, with the option to extend the hire, change the vehicle or even cancel the agreement altogether – with no penalties.
Unlike car sharing clubs, where multiple drivers/members use and pay for the car as they use it, subscriptions are a far more hygienic and personalised option. Once the car is issued to you, it is effectively yours for the duration of the term.
This highly flexible model has some interesting features. For example, you pay one monthly fee that covers pretty much all your costs, so you don’t have to pay extra for MOTs, servicing, road tax, breakdown cover or often insurance. The only real responsibility the customer has is to keep the car in good condition – allowing for fair wear and tear – and report any breakdowns or unplanned servicing or repairs as soon as they occur.
The main downside to car subscription is that the monthly fee is usually more expensive than leasing and/or contract purchasing, however, there is seldom any deposit to pay upfront. Nevertheless, the overall flexibility and simplicity of the service is becoming increasingly appealing to some buyers.
Another interesting benefit for subscription services over leasing is that it allows you to deal directly with a trusted manufacturer via an online portal, from the comfort of your own home. Volvo has recently launched its new Care by Volvo subscription service, which allows you to order online with no deposit and have a car delivered to your home for no extra cost. Volvo also promises to secure you a car within 1 month and try it for 30 days with no notice period.
Jaguar Land Rover’s subscription service, Drive Pivotal (formerly Carpe) is similar but instead of individual cars offers a tiered format, grouping similarly priced vehicles. For example, for £750 per month, plus a one-off membership fee, you can choose between a Land Rover Discovery Sport, a Jaguar F-PACE or a Range Rover Evoque. Drive Pivotal is one of the more premium providers and as a result the monthly subscription includes all costs – maintenance, insurance, tax, breakdown cover and even cleaning. We expect many more manufacturers to offer this service in the near future.
Car subscription is also a great way of enjoying specific types of cars for specific months of the year. So, for example, if you needed a SUV from September through to April and then a sports car from May through to August for the summer months, that would be entirely possible. Alternatively, many people spend time abroad and only need a car for a certain number of months, and some are simply too busy to arrange insurance, repairs or MOTs and would rather someone else take care of it all.
Because of the increasing demand, there are now quite a few independent car subscription providers that can supply vehicles from virtually any brand. Some of the market leaders include Evogo, Cocoon Vehicles, Flexigo, Drover and Onto which is an electric car specific provider.
Given the surge in demand for leasing and with the right type of content marketing in place, we think it’s only a matter of time before many more car buyers switch to this even more flexible subscription model.