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Auto Blog
13-05-2025
- Automotive
- Auto Blog
Study Reveals Over Half Of Americans Are Open To A Car Subscription Instead Of Purchasing
It seems the same model used for the iPhone may be attractive to drivers, too. It seems the same model used for the iPhone may be attractive to drivers, too A new study suggests drivers are increasingly open to a subscription model for their next vehicle, which would upend car ownership. Rather than purchasing, financing, or leasing a car, drivers have become curious about the scheme many use to get a new phone every 12 to 24 months. Almost half of the respondents say that if tariffs increase car prices dramatically, they would explore the option diligently. The concept is nothing new; a car subscription model has been floated several times, most often by Silicon Valley startups looking to 'disrupt' car ownership. Other models, like Zipcar, a subsidiary of car rental company Avis, allow drivers to share their vehicles with those who don't own vehicles for a nominal rental fee. 2026 Honda CR-V TrailSport — Source: Honda Almost 60 percent of drivers are open to a car subscription service Extreme Terrain notes that 'nearly one in two Americans' are open to a car subscription model instead of buying or leasing their next vehicle. Another ten percent are interested only if insurance and vehicle maintenance are included. Forty-six percent are 'more likely' to explore a car subscription if tariffs cause vehicle prices to spike. Automakers may be to blame for this, too. Twenty-two percent of drivers are fatigued by the ever-expanding required subscriptions for things like navigation, in-car WiFi, and remote start, and feel that a subscription that includes the car is a better choice. Twenty percent say they'd be willing to pay 'over $600 per month' for a subscription, too. Almost 75 percent of respondents say the lack of a long-term financial commitment makes a vehicle subscription attractive, with two-thirds saying they'd want the option to cancel at any time. Over half (58 percent) say the ability to swap vehicles based on need interests them. 2026 Subaru Outback — Source: Subaru Toyota (57 percent) and Honda (50 percent) are the brands most respondents are interested in, with Subaru a distant third (31 percent). BMW, Lexus, Hyundai, Nissan, Audi, Ford, Jeep, Mercedez-Benz, General Motors, Kia, Mazda, and Volkswagen all rank between 20 and 27 percent. Unsurprisingly, the car company most often associated with disruption and technology-over-tradition, Tesla, ranked dead last – but did rank highest amongst Gen Z and Millennial respondents. Thirty-six percent of respondents want an ICE vehicle, while 28 percent would prefer a hybrid. Twenty-two percent had no preference, and only 14 percent said they'd want an electric vehicle via subscription. Gen X was most interested in ICE vehicles (47 percent), while baby boomers (41 percent) and Gen Z (33 percent) were most interested in hybrids. Why a subscription wouldn't work Succinctly, people are viewing the vehicle subscription as a monthly fee to rent a car with more benefits. Though most say they'd pay $600 per month for an all-in subscription, many (20 percent) also say they'd want to switch vehicles every six months. Respondents also noted they wanted to be able to change vehicles at any time based on need. This sounds like a flat fee for long-term rentals with the ability to swap your vehicle out anytime. Three percent would want to swap vehicles monthly, and 36 percent would be happy to subscribe to the same vehicle for a full year. Thirty-one percent say they'd be happy keeping the same car indefinitely via a subscription. Only 26 percent of respondents said they would want access to luxury vehicles, suggesting they want a daily driver that costs about the same as a leased or financed vehicle without the responsibility. BMW M235i xDrive — Source: BMW Final thoughts A car subscription is a novel concept, but it is untenable for whatever company owns the cars. Six hundred dollars per month is $20 per day, and for a 'daily driver' vehicle like a RAV4, which currently rents for double that amount via Avis for a 30-day rental period, that cost doesn't make much sense. A subscription model might work for entry-level vehicles, but it's hard to see how it would actually work for most drivers or the company that owns the vehicles.
Miami Herald
11-05-2025
- Automotive
- Miami Herald
Study Reveals Over Half Of Americans Are Open To A Car Subscription Instead Of Purchasing
A new study suggests drivers are increasingly open to a subscription model for their next vehicle, which would upend car ownership. Rather than purchasing, financing, or leasing a car, drivers have become curious about the scheme many use to get a new phone every 12 to 24 months. Almost half of the respondents say that if tariffs increase car prices dramatically, they would explore the option diligently. The concept is nothing new; a car subscription model has been floated several times, most often by Silicon Valley startups looking to "disrupt" car ownership. Other models, like Zipcar, a subsidiary of car rental company Avis, allow drivers to share their vehicles with those who don't own vehicles for a nominal rental fee. Extreme Terrain notes that "nearly one in two Americans" are open to a car subscription model instead of buying or leasing their next vehicle. Another ten percent are interested only if insurance and vehicle maintenance are included. Forty-six percent are "more likely" to explore a car subscription if tariffs cause vehicle prices to spike. Automakers may be to blame for this, too. Twenty-two percent of drivers are fatigued by the ever-expanding required subscriptions for things like navigation, in-car WiFi, and remote start, and feel that a subscription that includes the car is a better choice. Twenty percent say they'd be willing to pay "over $600 per month" for a subscription, too. Almost 75 percent of respondents say the lack of a long-term financial commitment makes a vehicle subscription attractive, with two-thirds saying they'd want the option to cancel at any time. Over half (58 percent) say the ability to swap vehicles based on need interests them. Toyota (57 percent) and Honda (50 percent) are the brands most respondents are interested in, with Subaru a distant third (31 percent). BMW, Lexus, Hyundai, Nissan, Audi, Ford, Jeep, Mercedez-Benz, General Motors, Kia, Mazda, and Volkswagen all rank between 20 and 27 percent. Unsurprisingly, the car company most often associated with disruption and technology-over-tradition, Tesla, ranked dead last - but did rank highest amongst Gen Z and Millennial respondents. Thirty-six percent of respondents want an ICE vehicle, while 28 percent would prefer a hybrid. Twenty-two percent had no preference, and only 14 percent said they'd want an electric vehicle via subscription. Gen X was most interested in ICE vehicles (47 percent), while baby boomers (41 percent) and Gen Z (33 percent) were most interested in hybrids. Succinctly, people are viewing the vehicle subscription as a monthly fee to rent a car with more benefits. Though most say they'd pay $600 per month for an all-in subscription, many (20 percent) also say they'd want to switch vehicles every six months. Respondents also noted they wanted to be able to change vehicles at any time based on need. This sounds like a flat fee for long-term rentals with the ability to swap your vehicle out anytime. Three percent would want to swap vehicles monthly, and 36 percent would be happy to subscribe to the same vehicle for a full year. Thirty-one percent say they'd be happy keeping the same car indefinitely via a subscription. Only 26 percent of respondents said they would want access to luxury vehicles, suggesting they want a daily driver that costs about the same as a leased or financed vehicle without the responsibility. A car subscription is a novel concept, but it is untenable for whatever company owns the cars. Six hundred dollars per month is $20 per day, and for a "daily driver" vehicle like a RAV4, which currently rents for double that amount via Avis for a 30-day rental period, that cost doesn't make much sense. A subscription model might work for entry-level vehicles, but it's hard to see how it would actually work for most drivers or the company that owns the vehicles. Copyright 2025 The Arena Group, Inc. All Rights Reserved.
Yahoo
17-04-2025
- Business
- Yahoo
3 Reasons CAR is Risky and 1 Stock to Buy Instead
Avis Budget Group trades at $75.35 per share and has stayed right on track with the overall market, losing 6.1% over the last six months while the S&P 500 is down 9%. This was partly due to its softer quarterly results and might have investors contemplating their next move. Is there a buying opportunity in Avis Budget Group, or does it present a risk to your portfolio? Check out our in-depth research report to see what our analysts have to say, it's free. Despite the more favorable entry price, we don't have much confidence in Avis Budget Group. Here are three reasons why there are better opportunities than CAR and a stock we'd rather own. The parent company of brands such as Zipcar and Budget Truck Rental, Avis (NASDAQ:CAR) is a provider of car rental and mobility solutions. Revenue growth can be broken down into changes in price and volume (for companies like Avis Budget Group, our preferred volume metric is available rental days - car rental). While both are important, the latter is the most critical to analyze because prices have a ceiling. Avis Budget Group's available rental days - car rental came in at 61.82 million in the latest quarter, and over the last two years, averaged 3.4% year-on-year growth. This performance was underwhelming and suggests it might have to lower prices or invest in product improvements to accelerate growth, factors that can hinder near-term profitability. We track the long-term change in earnings per share (EPS) because it highlights whether a company's growth is profitable. Sadly for Avis Budget Group, its EPS declined by 73.4% annually over the last five years while its revenue grew by 5.1%. This tells us the company became less profitable on a per-share basis as it expanded. As long-term investors, the risk we care about most is the permanent loss of capital, which can happen when a company goes bankrupt or raises money from a disadvantaged position. This is separate from short-term stock price volatility, something we are much less bothered by. Avis Budget Group burned through $1.20 billion of cash over the last year, and its $5.39 billion of debt exceeds the $534 million of cash on its balance sheet. This is a deal breaker for us because indebted loss-making companies spell trouble. Unless the Avis Budget Group's fundamentals change quickly, it might find itself in a position where it must raise capital from investors to continue operating. Whether that would be favorable is unclear because dilution is a headwind for shareholder returns. We remain cautious of Avis Budget Group until it generates consistent free cash flow or any of its announced financing plans materialize on its balance sheet. Avis Budget Group falls short of our quality standards. After the recent drawdown, the stock trades at 7.2× forward price-to-earnings (or $75.35 per share). While this valuation is optically cheap, the potential downside is huge given its shaky fundamentals. There are superior stocks to buy right now. Let us point you toward the Amazon and PayPal of Latin America. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free.
The Guardian
15-03-2025
- Automotive
- The Guardian
Low mileage, several careful renters … will car-sharing ever really get going?
Spotify did it for music. Netflix did it for films. For people in big cities, the app economy promised to do the same for cars: making a life without ownership of a couple of tonnes of metal possible. Businesses such as Zipcar, Enterprise Car Club and Share Now offer app-based car rental by the hour, while the likes of Hiyacar, Turo and Getaround have opened up the ability to rent neighbours' cars. During the Covid pandemic – and the easy money bubble – it seemed their time had come. Yet there are signs the momentum is slowing. San Francisco-based Turo last month abandoned plans to float on the stock market. Getaround, based in the same city, announced it was shutting down its US car-sharing operations to focus on Europe. And the valuation of the US's Zipcar, the world's biggest car-sharing company, was quietly downgraded this month by its owner, Avis Budget. This reporter's household is one of the 42% in London without a car. The public transport network in the capital has been good enough for long enough that tiresome people who insist owning a car is pointless in London were once the butt of a joke in the zombie comedy Shaun of the Dead back in 2004. That film was made four years after Zipcar was founded and three years before Apple's iPhone paved the way for the mobility app revolution. Now there are enough shared cars in London to give residents several nearby options for electric cars to pop to the shops or vans for house moves. Izzy Romilly, the sustainable transport manager for the green group Possible, has campaigned for a reduction in car use in cities, particularly by replacing shorter journeys with walking or cycling. 'It can be quite daunting to give up your car,' she says, but adds that people in cities who give up car ownership experience 'unexpected benefits' including better health and less stress as they walk or cycle more. However, a bit of flexibility is sometimes needed to walk 10 minutes in the rain to pick up a vehicle. Being in a 'dink' household – double income, no kids – undoubtedly helps. Colleagues with children laugh knowingly at declarations that car ownership is a thing of the past: determined car-lessness can falter when two children need to go to gymnastics on a chilly Saturday. Cars spend about 95% of their lives sitting still, while also taking up space worth £172bn in London alone. Car sharing allows those assets to be used more efficiently, getting greater use out of every vehicle and parking space. More efficient usage of cars would mean fewer vehicles needed overall. That would reduce the carbon emissions associated with auto manufacturing, which are set to increase as the world shifts to electric cars – although that switch will slash the much larger emissions from driving. Efficiency also means cost savings for users. British users of car shares can save thousands of pounds compared with buying a new vehicle, according to CoMoUK, a charity focused on increasing 'collaborative mobility'. The problem has been making the services profitable. Car-sharing companies have struggled with rising costs, including for insurance and from councils, which have raised parking permit fees. 'It's quite tough out there,' says Richard Dilks, CoMoUK's chief executive. Yet there is still evidence that the number of people opting for car-sharing services is rising. User figures in the UK rose from 354,000 in 2019 to 873,000 last September. In France, the number of car-share journeys was 45% higher in January than the same point two years earlier, according to government figures. 'There's loads of challenges on the supply side, but we have to balance it on the demand side,'says Dilks. 'That remains strong.' Owning a vehicle has been a rite of passage – and a staple of teen movies – in wealthy countries such as the UK and US for decades. During the pandemic, though, it appeared that the long march of car ownership had halted. The 2020-22 period bucked the trend of half a century in which the proportion of UK car-owning households rose from 52% in 1971 to 78% in 2022, according to the National Centre for Social Research. However, that trend snapped back during 2023. Still, carmakers are looking beyond traditional vehicle ownership. The owner of Fiat and Peugeot, Stellantis, owns shared car service Free2move, while Renault has Mobilize, a unit also experimenting with car sharing and rentals. JLR, the British manufacturer of the Jaguar and Land Rover brands, has set up two services to cater to people who want a luxury car without having to worry about going to a dealership – let alone insurance, servicing or roadside assistance cover. Rental periods range from a few hours or days under one service, The Out, to between three and 18 months with another, Pivotal. A Range Rover, for example, costs nearly £700 for a weekend, or north of £2,000 for a month. Jasdeep Sawhney, the managing director of InMotion Ventures, JLR's startup investment arm, says the services exemplify the shift from the 'ownership economy' to the 'consumption economy' since the pandemic. 'There's a whole cohort of younger customers – young and wealthy, of course – who don't want to own big things in their lives,' Sawhney says. 'Their lifestyles are very flexible. They travel a lot. These customers are not buying vehicles.' The Observer tried JLR's service, receiving an enormous – and, on London's tight streets, sometimes awkward – Range Rover delivered to the door and picked up a few days later. The rental highlighted one of the potential pitfalls of non-ownership, when the borrowed wheels scraped on the kerb in the automated parking mode – a manoeuvre that would prove costly for a paying renter. JLR's motivation is emphatically not to reduce ownership: car companies want more people to buy their vehicles. JLR's side-hustle rental services help it accrue revenues from people on average 20 years younger than the company's usual customers. Some renters have spent hundreds of thousands of pounds on Pivotal over three years – more than enough to buy a £123,000 Range Rover outright. Yet the enthusiastic reception for the services, which are already generating cash, suggests that people are becoming more comfortable in using cars as a service, rather than buying them as a product. There are opportunities at the other end of the scale of non-ownership too. France's BlaBlaCar is the champion of covoiturage, or carpooling. It has found success in France and Spain, where public transport is good from city to city but worse outside that. But it is growing fastest now in Brazil and India, poorer countries where public transport is severely lacking. 'There is a really strong case for accelerating on car sharing,' says Dilks, particularly to meet carbon reduction targets. 'Car clubs are only part of the solution – but they are [still] part of it.'
BBC News
14-03-2025
- Automotive
- BBC News
Car sharing switches to electric to boost appeal
Ieva Mackeviciute lives in Kaunas, Lithuania's second-largest city, but works in the capital, takes the hour-long train into her company's Vilnius office once a week, where she uses a car-sharing service to drive herself to client meetings throughout the an app, she can find where the nearest available car is, and drive off, paying by the minute - a system she finds convenient and providers even include parking in the price, and if she takes an electric car, it's even better, as they qualify for free parking around the city."The ability to move around a big city quickly, and not worry about parking, helps me have a more flexible schedule and better control of my time," says Ms Mackeviciute, 30, who works in despite being a regular car-sharing user, Ms Mackeviciute still owns a car in Kaunas, which she regularly uses for visiting family living in the countryside. And even while working in Vilnius, occasional issues with car sharing can disrupt Ms Mackeviciute's day."It can sometimes be hard to find a vehicle nearby. And sometimes, when you're in a rush the closest vehicle can have not one, but a few, maintenance lights on. While I do understand that fleet maintenance is a challenge, especially as a business grows, it is still disappointing," she says. When it comes to cars, most people feel like Ms Mackeviciute - they still want to own the UK, for example, while 61% of people drive daily and 68% are worried about the rising cost of car ownership, 78% don't know what car sharing is, and fewer than 20% of Londoners would consider signing up to such a scheme, according to a report by car rental company brands like Zipcar being around since 2000, industry data shows car sharing to still be a niche are just two million car sharing users in the UK, while around 35 million people still own a car."Consumers are still tied to exclusive access to their car. Clear scepticism about the ability for car-sharing options to provide a car to hand whenever they need it, and concerns about hassle, are the biggest issues," explains Felicity Latcham, associate partner at OC&C Strategy Consultants."This concern gets greater for families and older individuals who are particularly tied to being able to leave things in their vehicle." But the growing electrification of the car sharing market might be attractive to younger, eco-conscious a 2023 McKinsey survey of 4,000 people in the UK, France and Germany, 32% of those in the Gen Z bracket said they wanted to use shared-mobility schemes more, wishing to reduce private car survey also suggested that 50% of Gen Z also want their next car to be fully car-sharing industry is heading in that a quarter of European car sharing companies now offer a 100% electric fleet.A third of shared cars in the EU are electric vehicles, data from Statista shows. Meanwhile, Zipcar doubled its electric fleet in 2023 in the UK, with plans to go fully electric this the Lithuanian car-sharing company Ms Mackeviciute frequently uses, launched with a fully electric fleet in recent performance has been encouraging, with a registered user base up by 30% since 2022, and annual trip numbers up by 11%. Since July last year, users of the Bolt ride-sharing app - the Baltic states' answer to Uber - can also now book Spark founder Nerijus Dagilis is confident that the increasing availability of electric vehicles can get more people on board with car sharing, especially with the support of the city of Vilnius, which, on top of free parking for electric cars, allows them to be driven in bus lanes, too."Our customer pool is increasing every month, so that means we are creating a certain value for people, who prefer electric cars for sustainability reasons. It's becoming a daily habit for many people, especially families - we see more of them downsizing from two cars to one," says Mr Dagilis."The performance of electric cars is improving quickly, so while there is still some scepticism, as soon as an electric car can drive 500km on a single charge, I think people's anxiety should disappear." Canada's Kite is a car sharing company with a twist. Not only is it fully electric, but it partners with property developers to offer Kite cars to apartment building residents as either an included service, or for a subsidised membership fee, akin to a gym or pool.A Kite hub is installed usually on the first level of the building's underground parking, for residents to book their choice of up to 40 fully charged electric some locations, Kite users have the option of returning their car to a different building. Kite is currently live in 20 buildings across Canada, with plans to add 70 more in the next 18 months, adding properties in the US and founder, Scott MacWillam, says the convenience and saving they offer to prospective residents is a draw."There's a growing trend of more people with a busy city life wanting a 'turnkey' lifestyle. Real estate developers see this as a sales and marketing advantage," says Mr MacWilliam."Residents can save money by kind of ditching their privately-owned car, and that cost saving means they now can afford to live in the building, or maybe they can even upgrade their apartment."Mr MacWilliam says Kite gives thousands of building residents the chance to try both car sharing, and an electric vehicle, without any pressure or commitment, in a package where everything is covered - from charging and maintenance to is also hoping to install Kite hubs at train stations and introduce autonomous cars."What I'm most excited about, is we could fundamentally change the way buildings are built, forever," he says.
