Global Car Subscription Market Share Is Expected To Grow At A CAGR Of 35.1% By 2030

13-Mar-2023 | Facts and Factors

According to Facts and Factors, the global car subscription market size was worth around USD 5.1 billion in 2022 and is predicted to grow to around USD 99 billion by 2030 with a compound annual growth rate (CAGR) of roughly 35.1% between 2023 and 2030.

Global Car Subscription Market

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Car subscription is a new form of service that is witnessing slow by steady growth in the automotive industry. It allows customers to enjoy the benefits of owning a car without worrying about the liabilities that come along with it. In this service, customers can use a car for a specific period of time at a nominal fee or monthly subscription. This service method acts as a flexible and convenient substitute to traditional car ownership ways which also includes renting or leasing services. Customers do not require to provide a long-term commitment to car ownership and are free of the hassles involved in the resale, insurance, or maintenance of the car.

Browse the full “Car Subscription Market Size, Share, Growth Analysis Report By Subscription Period (More than 12 months, 6 to 12 Months, and 0 to 6 Months), By Subscription provider (Third Party and OEM), By Vehicle Type (Economy Car, Executive Car, and Luxury Car), and By Region - Global and Regional Industry Insights, Overview, Comprehensive Analysis, Trends, Statistical Research, Market Intelligence, Historical Data and Forecast 2023 – 2030" report at https://www.fnfresearch.com/car-subscription-market

Furthermore, the global industry is expanding because of the convenience it has to offer to the customer while also acting as an excellent source of income for the care provider. The global industry is relatively small compared to other ways of car ownership but is rapidly gaining popularity due to several factors.

The global car subscription market is projected to grow owing to the growing change in consumer preference since as per recent trends, more consumers are showing dissatisfaction with the traditional ways of car ownership. Factors like rising car prices, changing fuel rate, and overall high maintenance cost is leading more consumers to opt for options that allow higher convenience and flexibility.

Moreover, the increasing use of technology allows for smooth business operations since consumers can purchase and maintain payments logs digitally appealing to the younger generation that relies heavily on technology for everyday functions. The increasing adoption of mobility-as-a-service (MaaS) solutions could help the global industry players generate higher momentum during the forecast period. Car subscription is an integral part of the MaaS ecosystem since it provides consumers with solutions depending on their specific needs. In addition, this service method can be proven to be more cost-effective when used correctly. Since the customer is liable to only pay the fees, they do not need to worry about any additional cost that generally is associated when customers are sole owners of the car.

However, issues like profitability and pricing could act as a growth restraint. Running a car subscription service can call for a high investment in terms of vehicle maintenance, logistics, technological infrastructure, and other aspects. In case the pricing decisions are inaccurate, service providers can incur heavy losses or become unable to generate sustainable profit.

Furthermore, the global industry has intense regulatory barriers which arise due to insurance and licensing requirements that generally tend to change depending on the jurisdiction. Vehicle availability is another factor that could hamper the global sales volume. This is relevant in cases where there is a high demand for newer car models loaded with the latest facilities.

Urbanization may open doors for higher growth opportunities while high dealer dependency could challenge the market expansion

Global Car Subscription Market

Segmental Overview:

The global car subscription market is segmented based on subscription period, subscription provider, vehicle type, and region

Based on the subscription period, the global market is divided into more than 12 months, 6 to 12 months, and o to 6 months

  • The choice of the subscription period is completely based on the offerings of the service provider and the consumer's preference
  • However, as per official statistics analysis, the most preferred choice is between 0 to 6 months
  • Consumers tend to choose shorter service periods because it allows them higher flexibility and the option to choose a new service in case of dissatisfaction with the previous one
  • Long-duration services can be binding and offer lesser flexibility
  • The average cost of car subscription service in the US is around USD 750 to USD 1600 per month

Based on subscription provider, the global market divisions are third party and OEM

  • The global industry registered the highest growth in the original equipment manufacturer (OEM) segment due to several factors
  • OEM service providers are the best options in case consumers want access to the latest cars and versions
  • Furthermore, brand recognition works in the favor of the OEM segment since consumers have higher trust in the automobile manufacturer
  • In this segment, there is a high chance of cross-selling since automakers can sell other services like financing or products like accessories
  • Maruti Suzuki runs the car subscription service in India at a monthly rental cost of INR 12,999

Based on vehicle type, the global market divisions are economy cars, executive car, and luxury car.

Regional Overview:

North America is projected to witness the highest sales in the global car subscription market mainly due to the existing consumer database and the high demand for the service. Furthermore, the region has a high number of service providers which helps in improving service reach. In Europe, the regional market is generating revenue at an increasing rate due to growing consumer awareness, especially in regions that have strong public transport systems like the United Kingdom, Germany, and France. In addition, these regions are high in terms of ownership cost making car subscription services more cost-effective. Brands like BMW and Volvo have become early adopters of the service method. In Asia-Pacific, even though the program is in its early stages, it has already been well-received due to the growing population and increasing rate of urbanization.

Report Scope

Report Attribute

Details

Market Size in 2022

USD 5.1 Billion

Projected Market Size in 2030

USD 99 Billion

CAGR Growth Rate

35.1% CAGR

Base Year

2022

Forecast Years

2023-2030

Key Market Players

BMW AG, Clunco GmbH, General Motors, DriveMyCar Rentals Pvt Ltd., Fair Financials Corp., Hyundai Motor India, Clutch Technologies LLC., Tesla, Zoomcar, Tata Motors, Lyft Inc., Porsche AG, Toyota Motor Corp., Wagonex Limited, Volvo Car Corporation, and others.

Key Segment

By Subscription Period, Subscription provider, Vehicle Type, and Region

Major Regions Covered

North America, Europe, Asia Pacific, Latin America, and the Middle East &, Africa

Purchase Options

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Competitive Landscape:

The global car subscription market is led by players like BMW AG, Clunco GmbH, General Motors, DriveMyCar Rentals Pvt Ltd., Fair Financials Corp., Hyundai Motor India, Clutch Technologies LLC., Tesla, Zoomcar, Tata Motors, Lyft Inc., Porsche AG, Toyota Motor Corp., Wagonex Limited, Volvo Car Corporation, and others.

Recent Developments:

  • In October 2022, Chinese new energy vehicles manufacturers like BYD and NIo entered the European market. Both companies have entered a collation with car rental companies in Europe to encourage the launch of a car subscription service
  • In July 2022, Onto, an electric car subscription service provider, announced that it had raised USD 60 million in funds that will be used for European expansion. Onto plans to enter Germany in early 2023
  • In October 2022, Nio announced the launch of its brand in the EU with the company's 3 models becoming available in Sweden, the Netherlands, Germany, and Denmark

The global car subscription market is segmented as follows:

By Subscription Period

  • More than 12 months
  • 6 to 12 Months
  • 0 to 6 Months

By Subscription provider

  • Third Party
  • OEM

By Vehicle

  • Economy Car
  • Executive Car
  • Luxury Car

By Region

  • North America
    • The U.S.
    • Canada
    • Mexico
  • Europe
    • France
    • The UK
    • Spain
    • Germany
    • Italy
    • Nordic Countries
      • Denmark
      • Sweden
      • Norway
    • Benelux Union
      • Belgium
      • The Netherlands
      • Luxembourg
    • Rest of Europe
  • Asia Pacific
    • China
    • Japan
    • India
    • Australia
    • South Korea
    • Southeast Asia
      • Indonesia
      • Thailand
      • Malaysia
      • Singapore
      • Rest of Southeast Asia
    • Rest of Asia Pacific
  • The Middle East & Africa
    • Saudi Arabia
    • UAE
    • Egypt
    • South Africa
    • Rest of the Middle East & Africa
  • Latin America
    • Brazil
    • Argentina
    • Rest of Latin America

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