Webinar: Subscription Models

Webinar: Subscription models

Cadillac has recently announced that it is putting their pilot ‘Book by Cadillac’ subscription service on hold. Following modelling work recently undertaken by ICDP, the reasons are fairly clear; the business model that Cadillac have been running is simply not viable. This type of subscription service involves car-pooling and promises customers the exclusive use of a car covering all other motoring costs except fuel, chosen by the customer from a range of different models of vehicle, with the option to swap this car on a frequent basis for a flat monthly fee. ICDP analysis found that even with very high monthly fees and deep fleet discount support, these types of offerings will struggle to break even, largely due to the buffer stock required to maintain availability of such a wide choice of vehicles to all subscribers within the scheme.

Several OEMs are in the process of piloting and rolling out new subscription-based services, many of which are gaining considerable attention. Some fall into the category described above - others include BMW Access, Mercedes Benz Collection, and Porsche Passport - and we would define these as subscription car pools. Another type of service, also frequently described as subscription, is what we would describe as bundled leasing. Bundled leasing brings the fully-managed fleet driver experience to the retail customer, and examples such as ‘Care by Volvo’ and Hyundai’s ‘Ioniq Unlimited+’ are long-term leasing contracts that offer ‘peace of mind’ and convenience to the customer through inclusive insurance and the promise of seamless use via a collection and delivery service. This service is limited to guaranteeing replacement vehicles for all-inclusive breakdown, regular service, maintenance and repair. To the OEM and dealer, the model offers improved retention for aftersales including crash repair, and a continuing relationship for the replacement car. This model therefore appears more competitive and viable, as the subscriber to car ratio can be closer to 1:1, assuming that is, retail customers are prepared to realistically appraise their true cost of motoring.

These subscription services form part of wider experimentation in offering car-as-a-service and mobility, by OEMs and others, as shown below. ICDP continues to critically examine and evaluate the new business models that fall within this spectrum. This webinar will examine the subscription models currently being piloted, and explore the issues outlined above.

The webinar will take place on 15th January 2019, 10.00 a.m. UK, 11.00 a.m. CET, and is only available to ICDP members. There is no charge for attending so there is no need to book via the website, simply send Jane Trace an email and she will forward an official Webex invite to you projectoffice@icdp.net

Share this:

Hold date in calendar

Webinar: Subscription models

Cadillac has recently announced that it is putting their pilot ‘Book by Cadillac’ subscription service on hold. Following modelling work recently undertaken by ICDP, the reasons are fairly clear; the business model that Cadillac have been running is simply not viable. This type of subscription service involves car-pooling and promises customers the exclusive use of a car covering all other motoring costs except fuel, chosen by the customer from a range of different models of vehicle, with the option to swap this car on a frequent basis for a flat monthly fee. ICDP analysis found that even with very high monthly fees and deep fleet discount support, these types of offerings will struggle to break even, largely due to the buffer stock required to maintain availability of such a wide choice of vehicles to all subscribers within the scheme.

Several OEMs are in the process of piloting and rolling out new subscription-based services, many of which are gaining considerable attention. Some fall into the category described above - others include BMW Access, Mercedes Benz Collection, and Porsche Passport - and we would define these as subscription car pools. Another type of service, also frequently described as subscription, is what we would describe as bundled leasing. Bundled leasing brings the fully-managed fleet driver experience to the retail customer, and examples such as ‘Care by Volvo’ and Hyundai’s ‘Ioniq Unlimited+’ are long-term leasing contracts that offer ‘peace of mind’ and convenience to the customer through inclusive insurance and the promise of seamless use via a collection and delivery service. This service is limited to guaranteeing replacement vehicles for all-inclusive breakdown, regular service, maintenance and repair. To the OEM and dealer, the model offers improved retention for aftersales including crash repair, and a continuing relationship for the replacement car. This model therefore appears more competitive and viable, as the subscriber to car ratio can be closer to 1:1, assuming that is, retail customers are prepared to realistically appraise their true cost of motoring.

These subscription services form part of wider experimentation in offering car-as-a-service and mobility, by OEMs and others, as shown below. ICDP continues to critically examine and evaluate the new business models that fall within this spectrum. This webinar will examine the subscription models currently being piloted, and explore the issues outlined above.

The webinar will take place on 15th January 2019, 10.00 a.m. UK, 11.00 a.m. CET, and is only available to ICDP members. There is no charge for attending so there is no need to book via the website, simply send Jane Trace an email and she will forward an official Webex invite to you projectoffice@icdp.net

Share this:

Hold date in calendar

Webinar: Subscription models

Cadillac has recently announced that it is putting their pilot ‘Book by Cadillac’ subscription service on hold. Following modelling work recently undertaken by ICDP, the reasons are fairly clear; the business model that Cadillac have been running is simply not viable. This type of subscription service involves car-pooling and promises customers the exclusive use of a car covering all other motoring costs except fuel, chosen by the customer from a range of different models of vehicle, with the option to swap this car on a frequent basis for a flat monthly fee. ICDP analysis found that even with very high monthly fees and deep fleet discount support, these types of offerings will struggle to break even, largely due to the buffer stock required to maintain availability of such a wide choice of vehicles to all subscribers within the scheme.

Several OEMs are in the process of piloting and rolling out new subscription-based services, many of which are gaining considerable attention. Some fall into the category described above - others include BMW Access, Mercedes Benz Collection, and Porsche Passport - and we would define these as subscription car pools. Another type of service, also frequently described as subscription, is what we would describe as bundled leasing. Bundled leasing brings the fully-managed fleet driver experience to the retail customer, and examples such as ‘Care by Volvo’ and Hyundai’s ‘Ioniq Unlimited+’ are long-term leasing contracts that offer ‘peace of mind’ and convenience to the customer through inclusive insurance and the promise of seamless use via a collection and delivery service. This service is limited to guaranteeing replacement vehicles for all-inclusive breakdown, regular service, maintenance and repair. To the OEM and dealer, the model offers improved retention for aftersales including crash repair, and a continuing relationship for the replacement car. This model therefore appears more competitive and viable, as the subscriber to car ratio can be closer to 1:1, assuming that is, retail customers are prepared to realistically appraise their true cost of motoring.

These subscription services form part of wider experimentation in offering car-as-a-service and mobility, by OEMs and others, as shown below. ICDP continues to critically examine and evaluate the new business models that fall within this spectrum. This webinar will examine the subscription models currently being piloted, and explore the issues outlined above.

The webinar will take place on 15th January 2019, 10.00 a.m. UK, 11.00 a.m. CET, and is only available to ICDP members. There is no charge for attending so there is no need to book via the website, simply send Jane Trace an email and she will forward an official Webex invite to you projectoffice@icdp.net

Share this:

Hold date in calendar

Webinar: Subscription models

Accommodation not required for a webinar

Share this:

Hold date in calendar