Vehicle Subscriptions Services Must Take 3 Critical Steps for Shared Model Transition
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The automotive business model is shifting from ownership to shared services. Driving this trend are the spike in vehicle prices, rise of remote work, and emergence of electrification and "software-defined" cars. Many OEMs, including Volvo and Toyota, and third-party operators, such as FINN and Carro, are responding with subscriptions for vehicles and for in-vehicle and vehicle-related services. More broadly, all types of transportation options are evolving toward subscription models to expand customer engagement and retention by reducing decision-making to tapping a few choices on an app. Adjusting pricing, increasing flexibility, and partnerships between OEMs, dealers, and third-party operators, will pave the way for subscription services to attract more interest and for operators to drive growth. This report details the automotive industry’s progress toward this vision, the hurdles to adoption, and opportunities for car makers, service providers, and other market sectors.
