The new mobility: sharing and subscriptions instead of purchasing and ownership

The availability of new mobility models means that customers now have more options when it comes to mobility than was the case 10 years ago. What began with the entry of Uber as the first digital ride service provider has now developed into a variety of on-demand, subscription and sharing solutions. Instead of “buy or lease”, customers now have to make a complex decision as to whether it is still worth owning a car.

To illustrate the complexity graphically, we have taken five exemplary mobility solutions and plotted them against the annual mileage based on their monthly costs. A compact class car was considered for all solutions, including all costs (depreciation, maintenance, repairs, operating costs, registration fees, etc.).
Insights for the customer

For people in urban areas who have a limited amount of driving per year and at the same time can do without exclusive use of their vehicle, car sharing is an attractive way to be mobile at low cost. For those for whom owning a car is a prerequisite, we have examined the other options in more detail below.
In comparison, your own car is the most expensive option. It is linear, but increases with high mileage, which is due to the increased maintenance requirements.
The three subscriptions compared are all cheaper, which can be explained in particular by economies of scale. The cars are insured as a whole in a fleet insurance policy and may be provided by the OEM on preferential terms. These advantages are passed on to the customer, who can save up to €100 per month.
This market could be particularly exciting for OEMs, as they have the potential to find the most cost savings by renting directly to the end customer. Production, repair, maintenance, insurance and tires can be ordered or carried out collectively. In addition, planning security and customer loyalty can be increased. It remains to be seen whether manufacturers will increasingly enter this market.
Significance for the dealership

The car dealership is directly affected here. On the one hand, part of the business is at risk of being lost, as new car sales may increasingly take place directly with the manufacturers or subscription providers, and on the other hand, the customer’s information situation is improving. The dealership must understand the customer’s situation as well as possible and be prepared for it.

Examples of how a dealership can respond to this:
  • Intensifying the sale of maintenance or service packages, possibly going beyond the OEM’s offers, can copy the “all-inclusive” character of a subscription.
  • A more flexible design of leasing contracts, for example through early termination, the possibility of special payments or the adjustment of mileage, can loosen the character of a fixed contractual commitment to 36 months.
  • Creating an offer that combines a leasing contract with other mobility services, such as public transportation or even an additional sharing offer. Incidentally, some manufacturers are already offering to rent out their own vehicles in a sharing pool for a fee in the future.
  • As a dealership, maintain and intensify personal contact with the customer, as this is lost when a direct contract is concluded with the OEM. Contact with a personally responsible service employee is crucial for many customers and cannot be replaced by anything else.
 

Lambert Görsdorf​

Consultant

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