Subscription businesses are continuously growing. An industry that was once limited to books and magazines has rapidly evolved and allows consumers to look at products in a new, personalized way.
According to data by Hitwise, there are about 5.7 million subscription box shoppers in the United States. With this success rate, new subscription services have jumped on the bandwagon, including cars.
Monthly car subscriptions are a new alternative and more flexible alternative to owning or leasing a vehicle. Depending on the company, the packages include a monthly fee for the vehicle, auto insurance and maintenance.
Ford started their own car subscription service through the company Canvas in 2017. Canvas is available in San Francisco and Los Angeles for qualified drivers, 21 years of age and older. The subscriptions range from $379 to $1,125 depending on the model and whether or not it is considered a luxury vehicle.
The plan does have driving limits in place. Drivers are allowed 500 miles per month but there are available options to purchase additional millage for an additional fee for unlimited miles for an additional $100 a month.
However, customers are paying thousands of dollars into a program without the possibility of ownership at the end. Some may see it as wasted money, or a more economic choice compared to renting a car for longer periods of time.
Similar car subscription services are available throughout the United States. Fair is available in 11 major cities but the company does charge a start payment every time a car is changed. Flexdrive subscriptions include insurance, regular maintenance and roadside assistance and shorter subscriptions from seven to 28 days. Borrow has its own niche only offers electric cars.
Manufactures have offered their own version of subscription services for quite some time. Access by BMW and Book by Cadillac offers loyal customers an opportunity to drive new models for a hefty price. A study by cars.com found that that these subscriptions cost 28 to 102 percent more than the cost of leasing the vehicle per month.