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Redusernab Asks: Would You Ever Use a Car Subscription Service?

Greg Kachadurian April 9, 2018 Redusernab Asks 29 Comments

The auto industry’s latest and greatest idea is that car ownership is scary and needs to be made less scary by “smartphone-like” subscription plans. A handful of automakers are already experimenting with it in select markets and each program is basically like a more expensive lease made way more convenient. But is it worth it?

Of the three subscriptions I’ve bothered to learn about, Porsche and BMW have the programs in select US markets while Volvo has a program available nationwide. Each plan has a flat monthly fee (because smartphone users love flat fees) that includes all maintenance and insurance costs, which is probably the most attractive part of it to most people. Something people like us could appreciate is that Porsche and BMW will let you switch cars an unlimited amount of times between whichever models your price point entitles you to. So if you initially picked a BMW X4 but soon realized how dumb you were for picking that piece of shit, you can arrange for an M2 to replace it using a phone app. The new car is then delivered to you freshly detailed with the seat warmers set just right. You never have to set foot in a dealership again. They even have roadside assistance included for when your turn on the village bicycle ends badly.

Volvo’s plan is almost more traditional in that you’re assigned a car that you can spec out, but you’re entitled to an upgrade in 2 years. Swapping for a bigger car is available but it’s temporary. It’s not as fun as the other two subscriptions, but it also doesn’t cost a minimum of $2,000 a month. Oh yeah… that’s the catch. If you want to play around with some of Germany’s finest, you gotta pay at least that or upwards of $3,700 each month for the privilege of having worry free motoring. Not surprisingly, Volvo’s is the most sensible with plans starting at $600 per month.

Whether you’re more interested in the tame and responsible subscriptions or the wild and extravagant ones, is a car subscription service something you would actually use? Is this really going to be the #disruptive future of “shared #mobility” or is true car ownership still the way to go?

[Image source: Porsche]

  • neight428

    I think this is one product designed to solve a very small problem of very rich people, hence the laughable price. If you are a committed Porsche snob, er, I mean, enthusiast, and you can only drive one car at a time, how can you satisfy your cravings for the newest twist on the Sport Chrono package when you still have eight months left on your Macan lease? This is rarified air that anyone selling anything wishes to achieve.

    • Greg Kachadurian

      True, but Porsche and BMW allow unlimited swapping. So it’s like a lease that lets you pick a new car every week if you really wanted to.

    • crank_case

      I don’t think the price is that mental when it appears to cover insurance. Add up payments, insurance, depreciation, servicing, registration/road tax and it’d add up quite quickly.

      It’s for the rich for sure, but I can understand it if your were cash rich but time poor. You get to experience lots of different cars, and if it breaks, it’s not really your problem.

      A lot of wealthy people spend time at different cities for various reasons, so if its nationwide, it’d save you having a car in each city.

      • neight428

        The insurance angle is an interesting one. If you are managing a fleet big enough, you will self insure somehow because it is cheaper. Roll the cost of third party insurance into your calculations and you just pocketed an insurers profit margin along with your usual lease economics gravy.

  • P161911

    I had one of the senor executives at a former employer tell me that soon all cars would be either leases or subscription services. No need to worry about anything after three years of car life, it would be replaced by then. This would be especially true in Europe and in cities. This exec was European and had little to no grasp of the fact that the AVERAGE age of a car on American roads is 10 years old and about half the people don’t live in an urban area.
    I can’t stand the idea of a lease in 98% of the cases. This is just a lease on steroids. I could see insurance companies being the driving force behind this. Jack up the rates until personal auto insurance isn’t a viable option.

    • Maymar

      Frankly, no shortage of older cars in European cities either, unless the exec is assuming that rolling regulations will consistently render anything older than 3 years obsolete.

      • P161911

        I think it was a combination of not having an automotive background and having a high enough income to not understand the economics of anything below the top 10% of income earners. That and the whole “We need an app, we won’t need to buy cars, we can take Uber!”

  • 0A5599

    I already have a subscription plan.

    I buy a cheap hooptie, and when it expires, I buy another. Considerably less than $2k/month unless I go through more than a dozen cars per year.

    • P161911

      Plus you usually have 30 days after purchase to do the registration and insurance. Just swap every 30 days to avoid those fees.

  • Okay, I’m convinced. I’ll make getting a car subscription app a high priority if I ever get a cell phone.

    • 0A5599

      You don’t necessarily need a cell phone to use an app. They work on tablets, too.

      • That is a ridiculous misrepresentation of my willingness to embrace technological advancement. I wear glasses.

  • P161911

    They should do something like this with the first 30 days at a ridiculous cheap teaser rate, say $99 or even $199. This would be good for someone like GM or Hyundai/Genesis that is trying to prove that “Hey we make really nice cars too!” Basically a long extended test drive of anything in the manufacture’s fleet. Get your money back if you buy or lease a new car.

  • onrails

    If this ever gets cheap enough for it to be within reach of us unwashed masses, I can see it quickly turning into a “this is why we can’t have nice things” situation. People trash the stuff they OWN to such a degree it’s disturbing. Imagine what would happen to what is basically a rental.

    • P161911

      My motto is “Rental cars don’t have to obey the laws of physics!”

        • P161911

          The best rental car stories that I have heard since people stopped racing Shelby GT-350H models involved showroom stock racers and engine swaps.

          • neight428

            Buy 6-cylinder mustang, Rent GT-350H, invite friends for a weekend, swap drivetrain and suspension, return GT350-H, plead ignorance.

          • 0A5599

            I remember reading a story about NASCAR back when stock cars were still based on production vehicles. I think it was Richard Petty who had a crash during practice and the local dealer didn’t have a replacement roof in inventory, so in order to race on Sunday, the team rented a similar vehicle, used it for parts, and returned it minus a roof, etc. on Monday.

            • P161911

              In the very early days of NASCAR they didn’t use race tires, just street tires. There was at least one driver that took advantage of Sears generous tire warranty.

  • Zentropy

    I’d never do it, but I don’t even lease. My wife and I buy our primary cars and keep them for 10 years each, so we can stagger the payment periods and have only one car payment at a time. I prefer older cars, though, so I have a beater that I use for daily driving. My “good” car is basically a family/grocery hauler.

  • dukeisduke

    I might be able to afford it if the fleet consisted of cars from Roadkill. I think that would be more entertaining than Porsches, anyway.

    • Alcology

      I think that plan involves paying you to drive them, but the catch is you have to make them driveable. And you have to film yourself doing it. In fact, I think their plan is fully subscribed.

  • Maymar

    The only thing I could see being appealing for me is the option to occasionally borrow some sort of sports car I can’t afford or justify year round (and I don’t have the space to store an old beater sports car). But then anything I’d want to have occasional access to is the exact sort of thing that from working in the rental industry, I wouldn’t loan out to anyone else.

  • Alff

    I think everyone should jump on this bandwagon … except me.

  • JLS3000

    I really like the subscription idea!! Right now plans are skewed as only high end luxury companies like Porsche offer them and are requiring thousands and thousands per month. With less premium brands I think it would work, though. It’s not much more than a lease, has maintenance covered, and you get to switch vehicles when you want? Sounds great to me! Even $600/mo for a Volvo doesn’t seem unreasonable. All the companies offer “attractively low” lease monthly payments, but almost always with a substantial chunk of money down and fairly strict mileage limits. For example: A base V60 ($40,000) is currently being advertised at $375/mo for 36 months but you’ll need to put down over $3,555 upfront and are only give a 10k/year mileage allowance. That advertised price also assumes you already have a Volvo to get a $1000 “loyalty” discount. And, of course, for any of these lease offers you’ll need immaculate credit to qualify in the first place…

    I’d consider a reasonably priced plan with a company like Mazda (Subaru, Toyota, and even Nissan would probably be on the list, too) if they could keep the price point within the car payment/car payment insurance ballpark. $400-500 would be worth considering, and most certainly if it included insurance and maintenance. I currently own a 2013 370Z and love it, but the option to take a Versa or even Leaf for commuting on the weekdays, a fully loaded Maxima with leather and heated seats for the occasional long road trip, and/or a Frontier when hitting up Home Depot or the garden center is absolutely appealing. The Z is great, but can barely fit 2 people and a bag of groceries (not to mention a dismal 19 mpg premium while commuting, ugh…). Love the 6 speed manual, too, although not so much in stop-and-go. And then the fact that my wife can’t drive a stick shift… But it’s still a blast and I don’t want to lose it and have to settle for a Rogue or Sentra just because they make more practical sense in most situations. Life is too short to be stuck with bland cars.

    Another good candidate for a subscription plan would be Mini with to its reputation for subpar reliability, and yet coupled with the BMW-esque repair costs. A JCW coupe for around town, Clubman for trips, and Countryman All4 for weekend journeys up the mountain would be a solid way to go.

    Come to think of it, VW wouldn’t be a bad choice for a subscription, either.

    Clearly the downside for a lot of people is that they’d rather OWN their car and stick with it for a significant time after paying it off. (Of course then you also have to deal with depreciation, maintenance, repairs, and eventually selling or trading it in.) But no one would HAVE to use a subscription service anyway, just like no one has to lease or finance a new car in the first place.

    Tl;dr: This seems an upgrade to a lease in almost every way. It allows you to have the “responsible” car when you need it and the still get the “fun” car when you want. Not sure why there seems to be such opposition to it in the comments.

  • I’ve spent just over $2K on my Acura, purchase repairs and maintenance, but I’ve had it 6 or 8 months. Heck, I only spent $1,800 total on that 318ti and I drove it 30K miles over 2 years and then sold it for $1,450.

    So, no, a $2K per month subscription is not of interest to me.

  • HuntRhymesWith

    I think places like Classic Car Club Manhattan should consider how they can do this better than the OEMs. Not being restricted to one brand opens up so many doors. Michael Prichinello, last I checked, is also obsessed with taking his business new places before the competition.

  • JayP

    These subscriptions really point out how disposable new cars are now.
    Luxury cars are a 50% lease rate, Maserati closer to 70% proving that less and less people see these as a long term purchase.

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