As more people rely on Uber and Lyft for rides to get places, auto dealerships are beginning to feel the heat and looking to ideas like a car subscription.
As more and more people are starting to rely on Uber and Lyft for rides to get where they need to go, auto dealerships and startups are beginning to feel the threat and looking for ways to step up their game.
Their latest pitch is that of subscription cars, offered as the new model for car ownership. Customers can pay a monthly fee and drive a car for as long as they want to, before turning it back in. The rental package even includes insurance and maintenance needs.
Why a Monthly Subscription?
By offering a monthly subscription, rather having to buy a car, this opportunity takes away a customer’s struggle of having to sell their car when they want or need, a new one. Since most new vehicles depreciate the moment they are purchased and driven off the lot, having to sell a car often presents a problem for owners, especially if they had to get a loan to afford to buy their vehicles in the first place.
One interesting new startup is Fair. This well-funded company launched back in September 2017 and has received almost $1B from some big-time investors, including BMW’s venture arm Penske Automotive Group and Sherpa Capital.
The company’s executives come with many accolades and a great deal of knowledge in the car business. Fair’s founders, Scott Paintor, the ex-founder of publicly listed car-buying platform TrueCar, and Georg Bauer, who served as a top-level finance executive at Tesla, BMW, and Mercedes-Benz, have been hard at work to promote this new venture.
Using Fair, when a customer wants to switch from the car they’ve been paying for to something different for the summer, they can do so easily. The company makes it simple to switch from vehicle to vehicle without any problems.
Major Auto Manufacturers Are Jumping Onboard
Other larger auto manufacturers are entering into the subscription game as well. Volvo and Lincoln announced new subscription services recently at the L.A. Auto Show, and Porsche is now offering a subscription service that includes roadside assistance, a generous insurance policy, full detail washes, and a personal concierge who will clean and deliver every vehicle.
For many of us, we just want a good, reliable car to get us from Point A to Point B that will not cost us too much money on repairs and will not add to our debt. A car subscription might just be the answer.