Burlingame, Sept. 09, 2024 (GLOBE NEWSWIRE) -- The global vehicle subscription market, valued at $4.52 billion dollars in 2024, is on a trajectory of rapid expansion, with projections indicating it will soar to 35.49 billion dollars by 2031, at a Compound Annual Growth Rate (CAGR) of 34.2% during the forecast period, as highlighted in a new report published by Coherent Market Insights. Vehicle subscription services provide the flexibility of short term access to a variety of vehicles without long term ownership responsibilities. This flexibility aligns well with the preference of Millennials and is driving the growth of the vehicle subscription market.
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Market Dynamics:
The growth of the Vehicle Subscription Market is attributed to the increasing popularity of the mobility-as-a-service business model and rising preference towards subscription-based transportation services among consumers. The MaaS model offers flexible ownership schemes that eliminate lengthy vehicle registrations and insurance hassles. It allows users to gain access to a variety of vehicle makes and models, pay per use, and terminate the contract any time as per their changing needs. This flexible approach eases budgeting and reduces commitment compared to traditional vehicle ownership.
Vehicle Subscription Market Report Coverage
| Report Coverage | Details |
| Market Revenue in 2023 | $4.52 billion |
| Estimated Value by 2031 | $35.49 billion |
| Growth Rate | Poised to grow at a CAGR of 34.2% |
| Historical Data | 2019–2023 |
| Forecast Period | 2024–2031 |
| Forecast Units | Value (USD Million/Billion) |
| Report Coverage | Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Segments Covered | By Vehicle Type, By Subscription Type, By Subscription Period, By Service Providers |
| Geographies Covered | North America, Europe, Asia Pacific, and Rest of World |
| Growth Drivers | • Changing Transportation Preferences • Integration of New Technologies |
| Restraints & Challenges | • Low Consumer Awareness • Limited Driving Range of Evs |
Market Trends:
Growing Adoption of Electric Vehicles: The rise in environmental awareness and stringent emission regulations have boosted the adoption of electric vehicles. Since EVs have lower maintenance and fuel costs compared to ICE vehicles, subscription services for EVs are gaining traction.
Preference for Zero Upfront Costs: Young customers especially prefer the all-inclusive plans offered by vehicle subscription services as they involve zero down payment or upfront costs. This make vehicle access more affordable.
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Market Opportunities:
The IC engine vehicle segment is expected to dominate the vehicle subscription market owing to the large existing fleet of conventionally fueled vehicles. Traditional gasoline and diesel vehicles make up the bulk of personal transportation options currently available. Vehicle subscription services allow users access to newer IC engine vehicles without a long-term ownership commitment. This provides an attractive alternative to owning a used IC vehicle outright.
The electric vehicle segment is anticipated to witness significant growth in the vehicle subscription market during the forecast period. As electric vehicle adoption increases and more EV models enter the market, subscribers will gain access to these newer technologies through subscription services. Vehicle subscription services help lower the upfront costs of EVs and allow users to experience electric driving without long-term investments. Subscription services may help accelerate consumer acceptance of electric-powered personal transportation options.
Key Market Takeaways:
The global vehicle subscription market is anticipated to witness a CAGR of 34.2% during the forecast period 2024-2031, owing to growing consumer preference for alternative vehicle access options over traditional ownership models.
On the basis of vehicle type, the IC engine segment is expected to hold a dominant position, accounting for over 60% of the market in 2024 due to the large existing fleet of gasoline and diesel vehicles available for subscription programs.
By subscription type, single brand subscription services are expected to be the most popular option, constituting approximately 75% of the market in 2024. These targeted services allow deeper brand immersion.
On the basis of subscription length, the 0-6 months segment is anticipated to be the highest subscribed plan, favored by users seeking short-term access without long-term commitments.
By service provider, OEMs are expected to hold the leading market share over the forecast period, dominating around 60% of the market in 2024 due to their vehicle supply and brand control.
Regionally, North America is expected to hold a dominant position over the forecast period, accounting for over 35% of the global market in 2024. This is due to early adoption of alternative mobility options in the region.
Key players operating in the vehicle subscription market include Arval BNP Paribas, Avis Budget Group, Carvolution, EZOO., LeasePlan, Lyft Inc., Mercedes-Benz Mobility, Orix, SIXT, The Hertz System, Inc., Volkswagen, Volvo Car Corporation, Flexdrive, Cluno GmbH, Myles, MARUTI SUZUKI INDIA LIMITED, Autoflex, General Motors, Upshift, Inc. Strategic partnerships and service expansions are common in this evolving market space.
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Recent Developments:
In October 2021, General Motors, announced that it expects its in-car subscription services to generate nearly $25 billion revenue by the end of 2030.
In September 2021, Volkswagen, launched a subscription-based car ownership model in collaboration with omni channel mobility solutions provider, Orix.
Market Segmentation:
By Vehicle Type:
- IC Engine
- Electric Vehicles
By Subscription Type:
- Single Brand Subscription
- Multi Brand Subscription
By Subscription Period:
- 0-6 months
- 6-12 months
- More than 12 months
By Service Providers:
- OEM
- Third Party
By Region:
North America:
- U.S.
- Canada
Latin America:
- Brazil
- Argentina
- Mexico
- Rest of Latin America
Europe:
- Germany
- U.K.
- Spain
- France
- Italy
- Russia
- Rest of Europe
Asia Pacific:
- China
- India
- Japan
- Australia
- South Korea
- ASEAN
- Rest of Asia Pacific
Middle East:
- GCC Countries
- Israel
- Rest of Middle East
Africa:
- South Africa
- North Africa
- Central Africa
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Author Bio:
Ravina Pandya, PR Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. With an MBA in E-commerce, she has an expertise in SEO-optimized content that resonates with industry professionals.
About Us:
Coherent Market Insights is a global market intelligence and consulting organization that provides syndicated research reports, customized research reports, and consulting services. We are known for our actionable insights and authentic reports in various domains including aerospace and defense, agriculture, food and beverages, automotive, chemicals and materials, and virtually all domains and an exhaustive list of sub-domains under the sun. We create value for clients through our highly reliable and accurate reports. We are also committed in playing a leading role in offering insights in various sectors post-COVID-19 and continue to deliver measurable, sustainable results for our clients.
