UsedCarNews.com
June 3, 2019
Experts Say Future is Subscriptions
HALLS OF POWER: Volvo is one of the most aggressive entrants into the subscription space, offering consumers the chance to subscribe to its XC40.
Rush - Dated Material
“Mobility” remains the big buzzword these days. Kelley Blue Book recently unveiled Ride, an all-new website built to help educate consumers about mobility options. Ride includes editorial and video content with dedicated sections focused on alternative-fuel vehicles, self-driving cars and alternatives to car ownership. Ride also will be working with a collection of lifestyle contributors to create relevant content. Alison Haislip will host regular video features for Ride. In addition, the site plans to provide tools and calcu-
lators to help consumers understand the mobility options and services that best it their personal and inancial needs. “Consumers are clearly interested in new methods of transportation that provide more eicient, afordable or convenient alternatives to their current Point A to Point B travel needs, but with technology moving so fast, it’s diicult to keep up,” said Karl Brauer, executive publisher of Kelley Blue Book. Manufacturers are especially excited about the idea of “subscriptions.” This is when customers pay a lat monthly fee to a manufacturer or
third-party provider in return for on-demand access to several vehicle models. The fee covers insurance, maintenance and roadside assistance. Manufacturers are investing in these services in various forms, either by ofering themselves or partnering with another irm. For example, Hyundai Capital America (HCA) recently partnered with Flexdrive, to co-develop various inancial options that support vehicle subscription as an alternative to traditional ownership. Consumers who have heard about these services are interested in the
concept, but many remains unaware of the idea. A recent study by Synchron found around 60 percent of respondents indicated ixed monthly cost and included maintenance and repairs as the biggest advantages of vehicle subscription services. More than 40 percent of respondents also indicated they would be willing to pay a premium price for a subscriptionbased model. “It’s not so much a matter of if, but when, customers will overwhelmingly demand subscription-based services,” said Gary Brooks, Synchron’s chief marketing oicer.