In a traditional car sales model, car subscription can play a complementary role by providing customers with more flexibility, allowing them to switch to a different vehicle or terminate their subscription if their circumstances change.

Car subscription can also help car dealerships attract new customers, increase customer loyalty, and provide an additional revenue stream.

By offering customers more convenience and flexibility, and providing dealerships with new opportunities to attract and retain customers, car subscription can play an important role in the future of the automotive industry.

The Role of Car Subscription in a Traditional Sales Model

Car subscription offers a complementary role to the traditional car sales model by providing customers with a more flexible option that allows them to have access to a car without the long-term commitment of a lease or the upfront costs of purchasing a vehicle.

Alternate Path to Purchase

Car subscription provides an alternate path to purchase for customers who may not be ready to commit to a traditional car purchase or lease.

By offering subscription plans that allow customers to test drive a vehicle for a longer period of time, dealerships can encourage customers to make a purchase down the line.

This can also help dealerships attract customers who may have been hesitant to make a purchase due to financial or other constraints.

By offering car subscription as a complimentary service, dealerships can offer a more flexible and convenient way for customers to experience the benefits of car ownership, leading to a potential increase in sales in the future.

Operational Alignment with Dealership Model

The operational requirements of a car subscription business are roughly aligned with the existing dealership model.

Dealerships already have the infrastructure and expertise in place to provide services such as maintenance and repairs, which are also required for car subscription services.

This means that dealerships can easily add car subscription as a complementary service to their existing operations without significant additional investment or operational changes.

Additionally, offering car subscription can provide dealerships with a new revenue stream without requiring significant capital investment or restructuring of existing operations.

Better inventory monetization

Car subscription allows dealerships to better monetize their inventory by offering vehicles to customers through subscription services.

Dealerships can offer vehicles that may have been sitting on their lots for extended periods of time, which could have otherwise resulted in decreased value for the vehicle or even a loss for the dealership.

Car subscription services can help ensure that cars are always in use, allowing dealerships to maximize their investment in their inventory.

This can also help dealerships to reduce their costs by minimizing the amount of time and resources spent on marketing and advertising to sell vehicles, as well as the costs associated with holding unsold inventory.

Overall, better inventory monetization through car subscription can help dealerships to maximize their profitability and better manage their cash flow.

Increasing the total addressable market opportunity

Car subscription provides a new way to reach customers who may not have been interested in purchasing or leasing a car through traditional means, including those who are otherwise not in a position to buy, such as international visitors.

This can help increase the total addressable market opportunity for dealerships, providing them with the opportunity to reach a wider range of customers and potentially increase their customer base.

Car subscription can also provide dealerships with a new way to engage with customers who may have been hesitant to commit to a long-term car purchase or lease, providing a more flexible and less risky alternative.

Overall, car subscription as a complementary service can help dealerships to expand their reach and tap into new customer segments, helping them to grow their business and increase profitability.

Supply of valuable used car inventory

Car subscription can provide dealerships with a supply of valuable used car inventory. When vehicles are returned at the end of a subscription term, dealerships can choose to add them to their used car inventory.

These vehicles have typically been well-maintained and are likely to have a lower mileage than other used cars on the market.

This can make them more attractive to potential buyers and can provide dealerships with an opportunity to sell high-quality used cars at a premium price.

Additionally, dealerships can use these vehicles as part of their trade-in program, potentially attracting new customers who are interested in trading in their current vehicle for a high-quality used car.

Overall, car subscription can provide dealerships with a valuable supply of used car inventory, helping them to increase their profitability and improve their overall operations.

‍