But why are car companies moving towards a subscription model?
And is it feasible in the long run?
Let’s dig deeper to find out.
What Is a Car Subscription?
For instance, as reported byBloomberg, BMW introduced an $18 monthly subscription to unlock heated seats.
What Is the Difference Between Car Subscription and Leasing?
Image Credt:Tesla
After the leasing agreement expires, you return the vehicle to the dealership or settle to buy it.
You could get penalized for early termination if you want to replace your car before the lease expires.
Most car subscription packages also offer roadside assistance, but you’re expected to pay for fuel.
Despite the flexibility of car subscription models, leasing is often a cheaper alternative.
Alternatively, you could consider renting a car to save money.
The potential is vast and could double most automakers' revenue over the next decade.
Image Credit:Ford
However, most manufacturers target subscriptions through service options that improve the driving experience.
They could even charge you to activateautomated vehicle technologiesthat improve safety.
Alternatively, you’re free to considercar-sharing options.
However, that car subscription model is usually more expensive than leasing or renting a car.
Because of that, most consumers are reluctant to sign up.
This means more profits for the car companies.
But with the subscription model, they could replace the lost service revenue with microtransactions.
