Pilot programs are set to start this year in US, following other luxury auto brands
Not to be left out by rivals, BMW and Mercedes-Benz appear to be joining the world of automotive subscription models that cover all of the fees required with car ownership or leasing under one payment.
Both BMW and Mercedes are expected to announce pilot programs for a subscription service that covers not only car payments, but maintenance and insurance, Automotive News reported on Tuesday. They would join the likes of Audi, Cadillac, and Porsche in offering customers a simplified payment structure and the flexibility to swap to a newer car sooner than a traditional lease or finance plan, or a higher-quality vehicle than a daily rental from the airport. BMW Group and Daimler, Mercedes’ parent company, already run car-sharing firms.
We are in the phase of looking at it and evaluating together with BMW Financial Services,” BMW of North America CEO Bernhard Kuhnt told the publication this week at the Detroit Auto Show. “And if we are going to do it, we are going to pilot it first to learn more about it.
Mercedes-Benz’s global sales chief Britta Seeger echoed Kuhnt’s feelings on the need to try it out, although that company may try it in more markets, whereas BMW plans to pick a single point. A BMW representative did not comment on the story to The Verge. A Mercedes spokesperson confirmed Seeger’s comments, but said details of a pilot program would be announced at a later date.
The biggest test for subscription-based services may come this spring when the new Volvo XC40 is offered with the company’s Care by Volvo subscription ownership service that rolls the car payment, insurance, and maintenance together, starting from $600 per month, with the ability to get a new car after 12 months. It appears the model of subscribing to a car or car service, rather than owning or leasing a car, may be attracting other automakers as they search for ways to attract new customers.
Excerpts from an article by Zac Estrada on The Verge"https://www.theverge.com/2018/1/16/16897374/bmw-mercedes-car-subscriptions-detroit-auto-show-2018\"
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