Does this mean car subscriptions are an improbable bet for the automotive industry? Or is it just a matter of time before the business model kinks are worked out? What will it take, in resources, capabilities, and strategy, to turn car subscriptions into a thriving part of the auto retail industry? And how are the different providers poised for advantage? Car Subscriptions at a Glance For many OEMs, the results have been lackluster, yet some startups, particularly in Europe, have fared well. In 10 years, car subscriptions could easily become a $30 billion to $40 billion market. But the market only recently has begun to gain traction with consumers and investors, as business models continue to evolve and an expanding pool of providers hone their formulas for competing. Vehicle subscription offerings from OEMs have been around for several years.

With the rise of the sharing economy and subscription services, from software-as-a-service to Spotify and Netflix to mobility services, it was only a matter of time before car subscriptions would arise. While pay-per-use models-car sharing, ride hailing, and other mobility modes-have become more common, the alternatives to outright ownership have been limited to short-term rental (not always cheap) or leasing, with typically longer-term commitments and restrictive terms. The CEO’s Dilemma: Business Resilience in a Time of Uncertaintyįor years, automakers have been looking for business models beyond car sales to diversify their profit pools.Technology, Media, and Telecommunications.

Year long spotify subscription