The Car Subscription Model: The Present of Car Ownership

The Car Subscription Model: The Present of Car Ownership
Photo by Peter Broomfield / Unsplash

In the ever-evolving landscape of the automotive industry, the car subscription model has emerged as a compelling alternative to traditional car ownership and leasing. This innovative approach offers a flexible, hassle-free, and cost-effective solution, making it an increasingly popular choice for modern consumers. Rexalto’s team has massive experience in creating smart mobility solutions, our colleagues actively used car subscriptions service themselves and are ready to share interesting insights about subscriptions both from business and consumer POVs. Here's why the car subscription model might be the better way to own a car now for you.

Flexibility at Its Finest
One of the standout benefits of a car subscription is its unparalleled flexibility. Unlike traditional car ownership, which ties consumers to a single vehicle for several years, car subscriptions allow users to switch cars more frequently. Whether you need a compact car for city commuting or an SUV for a family road trip, subscription enables you to swap vehicles to suit your needs. It depends on the terms of a certain subscription service that could provide a variety of periods for a car change. This flexibility extends to subscription durations as well, with many services offering month-to-month contracts, liberating consumers from long-term commitments.

All-Inclusive Pricing
Car subscriptions simplify budgeting with an all-inclusive pricing model. Typically, the monthly fee covers not only the cost of the vehicle but also insurance, maintenance, roadside assistance, and, in most cases, registration fees that you’d spend right after purchase. This means no surprise expenses and offers a single, predictable monthly payment. For consumers who find the complexities of car ownership — insurance shopping, maintenance scheduling, and unexpected repair costs — overwhelming, this streamlined approach is a significant advantage.

Less Depreciation Worry
Depreciation is one of the hidden costs of car ownership that often goes unaccounted for. The value of a new car can drop significantly within the first few years, leaving owners with a vehicle worth much less than they paid. With a car subscription, the burden of depreciation falls on the service provider, not the subscriber. When a customer decides to switch or end a subscription, he or she doesn't have to worry about the resale value of the car.

Access to the Latest Technology
Subscribing to a car service often means having access to the latest models and the newest technology. This is particularly appealing for tech enthusiasts who want to drive vehicles equipped with the latest safety features, infotainment systems, and advancements in fuel efficiency or electric mobility. Rather than being stuck with an outdated model, subscribers can frequently update their vehicle to enjoy the latest innovations in automotive technology. Car subscribers can just switch to the latest models every year without the headache of selling old ones or dealer’s trade-ins that could be not so worthwhile often.

Environmental and Lifestyle Considerations
For those with an environmentally conscious mindset, car subscriptions can be a more sustainable option. Some services focus on electric and hybrid vehicles, promoting greener alternatives without the long-term commitment. Additionally, for urban dwellers or those who don’t drive daily, a subscription can be more practical and cost-effective than owning a car that sits unused for much of the time.

The Future is Subscription-Based
The shift towards a subscription economy is evident across various sectors, from entertainment to software. The car industry is no exception. This model aligns with the preferences of younger generations, who value experience over ownership and flexibility over permanence. It reflects a broader trend towards minimalism and a desire to avoid the burdens of ownership.

Perfect fit for the Subscription
According to Rexalto’s team experience, there are hints when it all comes down to a car subscription as the best option:

  1. Second car for a family. That would be just a great option when a family owns their car and additionally subscribes for a second vehicle: for a season, a college year, or to stay more unencumbered by long-term obligations in cases of moving and family growing.
  2. Car for immigrated professionals and expats. When a customer doesn’t have lots of new country experience but still needs to drive.
  3. The first car of driving experience. It might seem unsuitable but is very comfortable as this time could be stressful for a new car owner.

The car subscription model presents a modern, convenient, and flexible alternative to traditional car ownership. By offering all-inclusive pricing, minimizing depreciation concerns, providing access to the latest technology, and catering to both environmental and lifestyle needs, car subscriptions are poised to transform how we think about driving. As the automotive industry continues to evolve, car subscriptions might just be the future of car ownership, offering a smarter, more adaptable way to stay on the move.

Rexalto has a list of product solutions for rental services, which helps to launch car subscription service almost effortlessly. Contact our team, if you want to know more about.