Dublin, May 08, 2024 (GLOBE NEWSWIRE) -- The "Global Car Subscription Market: Analysis By Vehicle Type, By Subscription Period, By Service Provider, By End User, By Region Size & Forecast with Impact Analysis of COVID-19 and Forecast up to 2029" report has been added to ResearchAndMarkets.com's offering.
In 2023, the global car subscription market was valued at US$5.90 billion, and is probable to reach US$26.26 billion by 2029. The global car subscription market value is projected to grow at a CAGR of 28.24%, during the forecast period of 2024-2029.
Global car subscription market is large and highly fragmented with a large number of players. Current participants in the automotive industry, including original equipment manufacturers (OEMs), dealers, captives, leasing, and rental companies, view subscription services as a complementary offering that allows them to make more effective use of their current vehicle inventory, typically using their own brands. Companies like Cluno exclusively focus on offering subscription services with a fleet of vehicles branded under their own name.
In recent years, some consumers have been opting for alternative options over owning a vehicle due to increasing interest rates and a shortage of vehicle inventory. In numerous countries, there has been a notable increase in the popularity of vehicle subscription services and choices. The main drivers of global car subscription market are mostly shifting customer habits, which are characterized by a predilection for on-demand services and a move away from conventional ownership structures.
Also, the shift from ownership to usership and the move to EVs, have been tailwinds for the subscription business, and they will continue. Moreover, millennials, especially, will be increasingly interested in subscription services due to the appeal of a debt-free and economical alternative. Global car subscription market is estimated to boost in the coming years due to increased integration of artificial intelligence, emergence of in-car subscription services, strategic partnerships with automakers, technological developments, etc.
Europe car subscription market enjoyed the highest market share in 2023, owing to the increasing number of individuals, particularly non-car owners, gravitating towards Vehicle-as-a-Service (VaaS) models In addition, European car subscription market players are adopting various strategies to further increase their market share. For instance, in December 2023, Volkswagen acquired 4.99% of the ordinary shares of the electric vehicle company XPeng Inc., Cayman Islands, (XPeng) at a purchase price totaling US$706 million.
Asia Pacific car subscription market is expected to grow with the fastest CAGR, due to the increasing demand for automobiles, as well as the rising young population experiencing growth in opportunities and per capita income. The growing adoption of Mobility-as-a-Service (MaaS) will impact the car subscription industry, as customers look for all-encompassing solutions that merge different forms of transportation like ridesharing, public transport, and car subscriptions.
As China continues to emphasize environmental sustainability and invest in electric vehicle (EV) infrastructure, there will likely be a growing demand for electric cars in car subscription services. Subsequently, the market for car subscriptions in India is expected to become more competitive as new companies enter the sector.
Market Segmentation Analysis:
By Vehicle Type: According to the report, the global car subscription market is segmented into four vehicle types: Executive car, Luxury car, Economy car and others.
Executive car segment acquired majority of share in the market in 2023, because such cars offer versatility and are highly spacious which means that can have numerous applications. Whereas, economy car segment have the fastest growing CAGR in the future, as some consumers opt for economy car subscriptions as part of their efforts to reduce their environmental impact smaller, more fuel-efficient vehicles in this segment can align with sustainability goals.
By Subscription Period: According to the report, the global car subscription market is segmented into three subscription period: 1 to 6 months, 6 to 12 months, and more than 12 months.
6 to 12 months segment acquired majority of share in the market in 2023 and is expected to grow with the fastest CAGR, as include individuals who need a car for a medium-term duration due to work assignments, extended travel plans, or other reasons. Moreover, businesses and corporate entities are increasingly turning to car subscription services for their fleet management needs.
By Service Provider: According to the report, the global car subscription market is segmented into two service provider: Independent/Third Party Service Provider and OEM.
Independent/Third Party Service Provider segment acquired majority of share in the market in 2023 and is expected to grow with the fastest CAGR, as independent service providers provide a greater selection of vehicles in comparison to traditional dealerships or subscription services offered by automakers. Moreover, third-party providers typically offer streamlined processes for subscribing to a car, managing payments, and scheduling maintenance. This convenience is appealing to busy consumers who value a hassle-free experience when it comes to their transportation needs.
By End User: According to the report, the global car subscription market is segmented into two end user: Corporate and Private.
Corporate segment acquired majority of share in the market in 2023, as businesses can easily modify the type and quantity of vehicles in their subscription fleet to meet changing demands and business requirements without the need for long-term commitments or dealing with asset depreciation. Whereas, private segment have the fastest growing CAGR in the future, as many consumers find subscriptions to be a cost-effective option, especially if they do not need a car daily or require different types of vehicles. Instead of making a large upfront payment to buy a car or entering into a long-term lease, they can pay a monthly fee that usually covers maintenance, insurance, and other related expenses
Competitive Landscape and Recent Developments:
The key players are constantly investing in strategic initiatives, such as new launches, mergers & acquisitions, introducing their products to emerging markets and more, to maintain a competitive edge in this market. For instance, in February 2023, Maruti Suzuki, a global provider in the automotive segment, announced its collaboration with SMAS Auto Leasing India Pvt Ltd. The collaboration would aim at improving the former's vehicle subscription services. SMAS is currently the fifth partner offering Maruti's vehicles to offer white plate subscriptions. Also, in October 2022, PSA Financial Services Netherlands which is a joint venture with Santander and Banque PSA Finance (Stellantis) as core members, announced partnering with Casi, a Norwegian startup. The move will assist the former in launching car subscription service named Drivenjoy in the Dutch-speaking territory.
Market Dynamics
- Growth Drivers
- Rapid Urbanization
- Augmenting Millennial and Gen Z Population
- Rising Digitalization
- Access to a Variety of Vehicles
- Rising Cost of Vehicle Ownership
- Stringent Government Regulation Regarding Emission Control
- Lack of Proper Public Transportation Infrastructure in Developing Countries
- Rising Penetration of Third-party Automotive Subscription Service Providers
Challenges
- Accessibility of Substitution
- Restricted Geographic Availability
Market Trends
- Integration of Artificial Intelligence
- Augmenting Electric Vehicles Sales
- Emergence of In-car Subscription Services
- Technological Developments
- Sustainability
- Mobility as a Service
- Personalizing the Car Subscription Experience with IoT
Key Players
- Bayerische Motoren Werke AG (BMW Group)
- Volkswagen Group
- Volvo Group
- Hyundai Motor Company
- Toyota Motor Corporation
- The Hertz Corporation
- Nissan Motor Corporation
- Mercedes-Benz Group AG (Mercedes-Benz Mobility AG)
- Onto
- Carly Holdings Limited
- Wagonex
- Steer EV
For more information about this report visit https://www.researchandmarkets.com/r/n8iroe
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