According to ABC News, instead of charging a high upfront fee, subscription business models concentrate on the generation of money so that a single consumer makes a series of payments for ongoing access to a good or service.
It anchors on the perspective that numerous people still pay for products and services they never use.
“Subscription services are a growing source of revenue for automotive companies, providing recurring income and necessary capital for continued operations and growth. The automotive industry relies heavily on funds for research and development, manufacturing, and marketing new products and services. The subscription business model offers a new approach to vehicle ownership,” says business expert Shane Perry of Max Funding—one of Australia’s leading small business funding facilitators.
Here are ten ways subscription services could change the automotive industry:
1. Automotive Subscription Services
Automotive subscription services could offer consumers access to various vehicles, allowing them to switch between them as needed. It would enable customers to access the vehicle they need for specific situations, such as off-roading or family trips.
2. Automated Vehicle Maintenance
Automated vehicle maintenance could be part of an automotive subscription service. Companies could provide “smart” services that monitor vehicle performance and alert customers when maintenance is needed.
3. Digital Dealership Platforms
Automotive subscription services could be provided through digital dealership platforms, allowing customers to make their subscription choices online. It could reduce the need for physical dealership visits, making the process more efficient and convenient for customers.
4. Mobility-As-A-Service
Mobility-as-a-Service (MaaS) could be part of an automotive subscription package, offering customers access to ride-hailing and car-sharing services. It could be especially beneficial for customers who only need access to a vehicle sometimes.
5. Fleet Management Solutions
Automotive subscription services could also include fleet management solutions. It would allow companies to manage their fleets more effectively, reducing costs and increasing operational efficiency.
6. Vehicle Customisation Options
Automotive subscription services could offer customers the opportunity to customise their vehicles. It could include the installation of accessories, software updates, and other features that would make the vehicle better suited to their needs.
7. Data Utilisation
Automotive subscription services could use data to improve the customer experience. It could include collecting data on how customers use their vehicles, which could help companies tailor their services more effectively.
8. Vehicle Leasing Options
Auto subscription services could offer vehicle leasing options, giving customers more flexibility in how they use their vehicles. It could enable customers to drive certain vehicles for a certain period without committing to purchasing them.
9. Automated Insurance
Automated insurance could be part of an automotive subscription package. It would allow customers to access comprehensive insurance with the flexibility to adjust their coverage as needed.
10. Automated Roadside Assistance
Automotive subscription services could offer automated roadside assistance. It could notify emergency services or auto repair companies in case of a breakdown or accident.
The subscription business model could be a significant game changer for the automotive industry. It provides a more flexible and cost-effective way for consumers to purchase and use vehicles, reducing the burden of long-term financing. This new business model, if successful, could significantly disrupt the traditional automotive market, thus making the automotive industry more efficient and affordable for all.