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How Do Car Subscription Services Work?

May 3, 2020

Who would have predicted that within 100 years of inventing the car, humans would go onto invent countless styles and upgrades, self-driving technology, and now, ways to drive cars without actually owning them?

If buying, leasing, renting, and ride-sharing weren’t enough, drivers now have the option to subscribe to almost any car brand they prefer. Noticing this trend, several car manufacturers have even created their very own independent subscription services. One of them, Book by Cadillac, enables drivers to swap their cars up to 18 times per year!

Why Car Subscriptions?

So, what’s the point? What makes a car subscription service any better than buying, leasing, or renting? For some, freedom comes in the form of owning their car and having no monthly payments. For others, freedom comes in the form of having plenty of options and no commitments.

This relatively new concept began with Book by Cadillac. The program is currently undergoing some updates that are expected to be unveiled in 2020, but here’s the gist. This month-to-month subscription service by General Motors allows subscribers to choose a vehicle from a select lineup of Cadillacs, including SUVs and sedans. It also allows them to swap out their vehicles whenever their car-needs change. Book is ideal for families whose needs change with the seasons, or car enthusiasts who bore of driving the same car year after year.

What’s Included in a Car Subscription?

As with most subscription services, the subscriber pays a starter fee. After that, the driver pays a flat monthly fee. The monthly fee includes everything from the car payment and insurance to roadside assistance and maintenance. Similar to a lease, the subscription company who owns the car wants to keep it in pristine condition for future users. Also like leasing, subscription services limit the monthly mileage allowance.

It may sound like leasing and subscribing are the same thing, but the primary differences are the length of usage, the vehicle options, and the all-inclusive monthly fee that covers insurance and maintenance. This makes subscription services more expensive that leasing.

Some plans, like Care by Volvo, try to meet in the middle. This plan works like a traditional lease with a multi-year commitment, but the driver has the option to switch cars after a year. With Volvo’s plan, drivers are allotted 15,000 miles per year, and their monthly fee includes insurance and wear and tear coverage.

Subscription Services by Car Manufacturers

If you’re particularly loyal to one specific car brand, you might want to consider going with a subscription service offered by the car manufacturer. Below is a short list of some of the most popular car subscription services offered by car manufacturers. As car subscription services continue to grow in popularity, we expect to see more car brands following the trend and launching their own services.

Access by BMW – From $1,099 per month
Audi Select – From $1,395 per month
Ford Canvas – Ford & Lincoln cars; From $380 a month
Porsche Passport  – From $2,000 per month
Book by Cadillac – Re-launching in 2020; From $1,800 per month
Care by Volvo – From $650 per month 

Subscription Services by Startup Companies

If you’re not sure which make or model to go with, try out one of these car subscription services that have popped up in the recent years. These startups offer a great way to explore different kinds of makes and models with few strings attached.

Drive Flow – From $899 per month or $50/month plus daily rate for on-demand needs
Fair – From $160 per month
Flexdrive – From $800 per month   
Revolve – From $1,500 per month
Borrow – Electric Cars, From $199 per month

The Silver Lining

Like anything else, when you don’t own it, there are a lot of stipulations. When it comes to subscription services, the limitations don’t stop at monthly mileage. Like a beloved pet, subscription companies like to keep tracking devices on their cars; meaning they can locate you anytime they want. If this gives you the heebie-jeebies, buying could be your only solace. Additionally, there are several other subscriber rules you’ll have to adhere by if you choose to go with a subscription service. These include:

The pros and cons really come down to driver priorities. If you’re keen on saving money, having ownership, and driving however many miles you please, then buying a car is the way to go. If you don’t want to commit to one car for more than three years, but want a practical monthly payment with new vehicle options, then leasing is for you. If your lifestyle and budget are flexible, and you hate the idea of committing to any car for longer than a month – plus not worrying about insurance or maintenance sounds like a dream – a subscription service is the way to go.