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All About Car Subscription Services
Car subscription services may soon usurp vehicle leasing programs as the most convenient way to drive. For years, drivers had one option if they wanted to borrow a vehicle without outright buying it: leases.
Leasing has steadily gained in popularity, growing to more than 25 percent of the share of new cars being distributed. That is, more than 1 in 4 Americans are obtaining a car by lease nowadays. That may soon take a turn towards a car subscription.
Unlike a lease, a car subscription program allows drivers to change cars regularly. That means drivers aren’t stuck with one option for an average of three to four years, like they are with leases. These new programs offer greater convenience and instant satisfaction. In the era of subscriptions, a short-term car subscription service is the logical next step.
What is a car subscription program?
A car subscription program allows you to change up the vehicle you’re driving on a regular basis. Most programs allow you to rent a car for as little as a few weeks before switching it out. Some allow you to switch cars as frequently as 18 times a year. Others have no limits on how much you can switch. With a car subscription program, you can try out all kinds of vehicles. This allows you to get a feel for your vehicle preference should you ever decide to buy one.
Additionally, often included in the program is the cost of insurance, maintenance and all other expenses associated with owning a car. This means users have one monthly price for all car use and maintenance, rather than several bills they must remember. The one-stop price eliminates the need to shop around and haggle. Users will know exactly what it costs to maintain a car – the cost of the car subscription service.
There are two major forms of car subscription program: programs owned by automakers and programs owned by third parties. A car subscription from an automaker will be locked into a particular brand. Additionally, automaker subscription services are typically geared towards luxury car buyers. Third-party car subscription services include more mid-end and low-end vehicles. Additionally, they are not necessarily locked into a particular automaker. Therefore, they offer more variety for lower costs.
Although car subscription programs offer freedom and a convenient single price, that convenience comes at a cost. The downside of such a program is that once all the prices are added up, the expense is usually greater than either owning or leasing. This is true for both automaker car subscriptions and third-party subscriptions. Combining the cost of insurance, maintenance and the vehicle comes with an unavoidable convenience charge. Nevertheless, for drivers searching for flexibility over commitment, a car subscription service can make a lot of sense.
Automaker Car Subscription Programs
Automakers that offer their own car subscription programs typically offer luxury vehicles. Because they are typically luxury programs, costs for automaker programs are much higher than for third-party subscriptions. In recent months, many automakers have moved to make mid-end and low-end models available through the services as well. Available subscriptions from automakers include:
Access by BMW – This BMW subscription has three membership plans – the Icon, the Legend and the M. The Icon is cheapest, at $1,100 a month. The Legend plan costs $1,400 a month and M level costs $2,700 a month. All levels include a $575 joining fee. Subscriptions include roadside assistance, washes, maintenance and insurance. The plan doesn’t lock you into a contract – you can cancel any month, pause your subscription for a $200 fee and switch between levels. Downside: the BMW subscription is only available in Nashville.
Book by Cadillac – For $1,800 a month, Book by Cadillac allows drivers to switch between high-end vehicles with ease. All vehicles include features like Apple CarPlay, Sirius XM Radio and built-in WiFi. The program allow up to 18 car exchanges a year, and the price includes insurance, maintenance and registration costs. The car subscription is month-to-month, like BMW’s. This program is currently only available in New York City, Los Angeles and Dallas.
Care by Volvo – This program offers two vehicles: the S60 and the XC40. A standard subscription includes 15,000 miles a year, and you can purchase more if you choose. Insurance, maintenance and roadside assistance is included. Unlike other plans Care by Volvo is a 24-month commitment, although you can upgrade after 12. Prices range from $650 to $850 a month.
Mercedes-Benz Collection – The Mercedes subscription allows drivers to switch between several luxury vehicles, often every few weeks or days. However, it’s only available in two cities. In Nashville, the Signature plan costs $1,095 a month and the Reserve plan comes in at $1,595 a month. In Philadelphia, the Signature is $1,595 a month plus tax and the Reserve is $2,995 a month plus tax. There is a $495 activation fee, and the car subscription continues month-to-month.
Porsche Passport – Porsche Passport subscribers have the choice of the Launch or Accelerate levels. The Launch includes four models and costs $2,000 a month. The Accelerate includes seven models and costs $3,000 monthly. Both include a $500 joining fee. Like the other plans, the Porsche Passport includes insurance, maintenance and washes. It has the least restrictions on how little or much time you can keep a car. However, Porsche Passport is only available in Atlanta.
Third-Party Car Subscription Programs
Third-party car subscription services are more likely to focus on offering low prices, flexibility or variety. Like automaker subscriptions, these usually include insurance, maintenance and warranty coverage. However, they do not often include washing services. Available third party services include:
Borrow – With three-, six- and nine-month plans, Borrow has less flexibility but occupies a unique niche: all vehicles are electric. It offers a Fiat 500e, Nissan Leaf, BMW i3 and VW e-Golf. However, Borrow says it will have the Tesla Model S beginning in winter 2018. The reservation fee is $25, and car subscriptions range from $399 a month to $1,499 a month depending on vehicle and length of time. This plan does not automatically include insurance. The service is based out of Los Angeles.
Canvas – Canvas allows you to subscribe for any length of time between a month and a year. The longer you subscribe, the less you pay per month. Costs can range from $379 monthly to more than $1,000 depending on your vehicle, car subscription length and mileage plan. The company serves the Bay Area and Los Angeles.
Carma – Carma offers month-to-month subscriptions, allowing drivers to change cars or cancel plans every time they pay. The car subscription includes insurance and maintenance, and drivers can choose a particular mileage plan. Prices begin at $499 per month and rise with vehicle type and mileage amount.
Fair – Fair has a unique business plan that emphasizes making cars affordable. Drivers make no time commitments for how long they subscribe, and the company has a fair price guarantee. The company says it determines what price works for a customer with data beyond a credit score. The car subscription includes insurance, maintenance and roadside assistance. Prices can range from under $200 to more than $800 per month.
Flexdrive – With Flexdrive, drivers can rent cars between seven and 28 days. The plan includes insurance, maintenance and roadside assistance. Flexdrive is available in Atlanta, Austin, Dallas, Fort Worth, Cherry Hill, NJ, Christianburg, VA, Philadelphia and South Florida. In some cities, drivers pay mileage subscriptions while in others it is bundled into the price. Instead of working with automakers, Flexdrive works with dealerships to move and provide cars.