Car subscriptions surge: Here's how you can drive your favourite car without owning it

In a shift in India's automotive landscape, car subscription services are gaining immense popularity among consumers. Entrepreneurs like Vikram Karmakar and consultant Kulbhushan Parashar are opting for car subscriptions over traditional ownership or long-term EMIs. Car subscriptions offer the flexibility of driving a desired vehicle without hefty down payments, making them a preferred choice for many.

Understanding Car Subscription

Car subscription allows individuals to own a vehicle without down payments or loans. Instead, subscribers pay a monthly fee covering insurance, service, and maintenance. The absence of long-term commitments enables subscribers to return, extend, or buy the car at their convenience.

Growing Market Trends

Industry estimates suggest that around 5,000 passenger vehicles in the price range of ₹3-18 lakh were subscribed in 2022. The trend is expected to double this year, with subscriptions projected to account for 10% of the total passenger vehicle market in the coming years. Young professionals aged 23-40, with monthly incomes between ₹75,000 and ₹2.5 lakh, are driving this surge in subscriptions.

Key Players in the Subscription Market

India's car subscription market is diverse, including traditional leasing firms like Avis and Orix, mobility companies such as Revv and Zoomcar, and major Original Equipment Manufacturers (OEMs) like Maruti Suzuki and Hyundai. Companies like Myles and Revv are witnessing rapid growth, with a focus on expanding their EV fleets to meet increasing demand.

Automakers' Response

Leading automakers like Maruti Suzuki, Hyundai, Mahindra, and Tata Motors are actively participating in the subscription trend. Maruti Suzuki, for instance, receives over 10,000 enquiries monthly for its subscription program, indicating a growing preference for asset-light vehicle usage.

Future Outlook

With the market expanding and consumer preferences evolving, car subscription services are expected to become a significant segment of India's automotive industry. The rise in subscriptions, particularly for SUVs and EVs, aligns with the changing preferences of urban consumers, emphasizing the shift from ownership to usership.