Instead of leasing or buying a car, subscribe to one
Finding the best car subscription plan requires a look at these factors.
Brian CooleyEditor at Large
Brian Cooley is CNET's Editor at large and has been with the brand since 1995. He currently focuses on electrification of vehicles but also follows the big trends in smart home, digital healthcare, 5G, the future of food, and augmented & virtual realities. Cooley is a sought after presenter by brands and their agencies when they want to understand how consumers react to new technologies. He has been a regular featured speaker at CES, Cannes Lions, Advertising Week and The PHM HealthFront™. He was born and raised in Silicon Valley when Apple's campus was mostly apricots.
ExpertiseAutomotive technology, smart home, digital health.Credentials
Three months. That's about how long I think a new car feels really new, even if it's one of the best cars of 2019. Then it becomes an appliance like the last car. Subscribing to a car from Porsche, Volvo or Mercedes instead of buying or leasing may be the antidote, but does it make sense?
Watch this: Forget rideshare, car subscriptions are a form of 'brandshare'
Car subscriptions are offered by carmakers, startups and car rental firms, but they share three major attributes:
Short terms: Many plans are month to month, so you don't have to make a long commitment to either a financial arrangement or a specific car.
Choice of cars: What you really want is an SUV as your family car, a sports car for weekend romps and an econobox for utilitarian slogs to work. That's a lot of cars. With a subscription, you can have all of those cars, just one at a time.
Package pricing: The car(s), maintenance, insurance, taxes and roadside assistance are usually rolled into one price. About all you pay for is gas, parking and, in some plans, excess mileage.
The details of each plan are eye-watering though. Read our exhaustive guide to the best car subscription plans available today and you'll come away with the old maxim: Easy, flexible, affordable; you can pick two of the three. But the bigger picture is whether subscriptions answer a question anyone was even asking.
The next curved TV? "I've been surprised how few people are genuinely interested in that type of ownership,"
director of marketing Robert Parker told Automotive News in September 2018 after putting some of their dealers' cars into the subscription market. "If you had asked me a year ago, I would have said this is the next big thing." Instead, car subscriptions may be more like the next curved TV.
Maybe that's because subscription plans typically share a variety of discomfort factors:
Limited market availability: Mercedes recently trumpeted that it was expanding its subscription service beyond Nashville and Philadelphia to Atlanta. That's it. Not one New York, California, Massachusetts or Florida city. But that's par for the course in the subscription world.
Kardashian pricing: Bottom line costs for car subscriptions often have the scent of "premium" about them. That's fine for a Porsche subscription but for a Fusion?
More fees than Spirit Airlines: Breadth of choice, frequency of flips, trim levels, excess mileage and non-covered maintenance can all add fees and upcharges. Not all plans suffer from these, but many do.
Someone else's insurance: The affluent customer that many of these plans target engineer their insurance to be a sophisticated umbrella of home, health, auto and life. Having insurance dictated to you in the category where you are most likely to suffer a loss can be disconcerting.
It's clear why startups are willing to scale those cliffs, they have nothing to lose but investor money as they seek to disrupt. But why are carmakers in this odd, niche game?
New blood to the brand:
says 80% of the people enrolled in Passport are new to the brand, introducing themselves at $2,000 to $3,000 a month. Marketer's dream.
"Millennialization": Study after cliche study says millennials like to subscribe to things rather than buy them. I'm not sure the millennial generation has shown all its colors yet, but carmakers need to hedge their bets.
Preparing for the future: Clearly, moving iron on the showroom floor via grinding tactics in a dealership finance office is a stale model. Car commerce shares a level of consumer dread with cable TV and timeshare condos. Subscriptions freshen up the process with tap-for-gratification apps and fun new options. They also help raise the bar on what "having a car" costs, creating some airspace to hide the $5,000 and up extra cost expected with self-driving cars. That's tough to do in a hardball $299 monthly payment you spent an entire Saturday negotiating.
A big say in the success of car subscriptions won't come from you, but from car dealers through whom almost all cars flow, even in many subscription plans. They tend to look askance at this new bastardized lease and have convinced Cadillac to rethink its offering and Lexus to refrain from even launching one so far.
Take a look at car subscription the next time you're in market -- at least that part's free -- but you may need a hearty appetite for flexibility for it to make any sense.