The automotive industry is reinventing itself. As it must. And not only in terms of the drive. Customers want independence, more flexibility, and less capital commitment. Suppliers are responding.
People want to be mobile. The invention of the steamship 300 years ago was a milestone. It was followed in 1825 by the first railroad, then the airplane and the automobile—and a car at your doorstep quickly became a status symbol. As a result of social issues such as sustainability and climate protection, as well as the development towards what is known as the sharing economy—the temporary lending or sharing of vehicles, for example—the number of people who have changed their demands regarding automobility has grown rapidly in recent years. And demand is transforming what is being offered. One of the new products is the car subscription.
Subscription contracts for magazines, TV, and music streaming services are classics. But does this also work for cars? The first providers of vehicles at flat-rate tariffs rolled onto the market in 2017. Initially, they were mainly independent start-ups. Then Volvo, Jaguar Land Rover and a handful of other manufacturers followed. As a rule, the in-house financial service organizations at the manufacturers’ headquarters assume operational responsibility. They are, as it were, the automotive banks that traditionally handle vehicle financing and leasing.
Conventional car rental companies such as Europcar, Hertz, and Sixt have also jumped on the bandwagon. And it has picked up speed. Small cars such as the Opel Corsa and mid-size and luxury sedans such as the Volkswagen Passat and the Audi A4 are all available on a subscription basis. But also sports cars like the Porsche 911. Demand for car subscriptions is growing rapidly. According to a Porsche Consulting estimate, in 2021 the number of contracts concluded in Germany already exceeded 50,000. The principle: customers pay a flat monthly fee for use of the vehicle during the contract period. All costs are included in the monthly installment: maintenance, wear and tear, general inspection, insurance, motor vehicle taxes. As a subscriber, the customer only has to pay for fuel—or electricity in the case of an electric car—plus a trip to the car wash and a refill of operating supplies.
Porsche Newsroom
People want to be mobile. The invention of the steamship 300 years ago was a milestone. It was followed in 1825 by the first railroad, then the airplane and the automobile—and a car at your doorstep quickly became a status symbol. As a result of social issues such as sustainability and climate protection, as well as the development towards what is known as the sharing economy—the temporary lending or sharing of vehicles, for example—the number of people who have changed their demands regarding automobility has grown rapidly in recent years. And demand is transforming what is being offered. One of the new products is the car subscription.
Subscription contracts for magazines, TV, and music streaming services are classics. But does this also work for cars? The first providers of vehicles at flat-rate tariffs rolled onto the market in 2017. Initially, they were mainly independent start-ups. Then Volvo, Jaguar Land Rover and a handful of other manufacturers followed. As a rule, the in-house financial service organizations at the manufacturers’ headquarters assume operational responsibility. They are, as it were, the automotive banks that traditionally handle vehicle financing and leasing.
Conventional car rental companies such as Europcar, Hertz, and Sixt have also jumped on the bandwagon. And it has picked up speed. Small cars such as the Opel Corsa and mid-size and luxury sedans such as the Volkswagen Passat and the Audi A4 are all available on a subscription basis. But also sports cars like the Porsche 911. Demand for car subscriptions is growing rapidly. According to a Porsche Consulting estimate, in 2021 the number of contracts concluded in Germany already exceeded 50,000. The principle: customers pay a flat monthly fee for use of the vehicle during the contract period. All costs are included in the monthly installment: maintenance, wear and tear, general inspection, insurance, motor vehicle taxes. As a subscriber, the customer only has to pay for fuel—or electricity in the case of an electric car—plus a trip to the car wash and a refill of operating supplies.
Porsche Newsroom
