Automotive Subscription Service Market: Current Analysis and Forecast (2022-2028)
Emphasis on Vehicle Type (Luxury Car, Executive Cars, Economy Car, and Others); Service Provider (OEMs, Mobility Providers, and Technology Companies); Subscription Period (1 to 6 Months, 7 to 12 Months, and 13 and above); End-Users (Business and Private); and Region/Country
Global Automotive Subscription Services Market is expected to grow at a significant rate of around 25% during the forecast period. An automotive subscription is a new kind of ownership that has set, recurring monthly fees that are mostly used to pay for the vehicle’s insurance and upkeep. The length of an automotive subscription typically ranges from a minimum of 1 month to a maximum of 2 years. The automotive subscription is a service that bridges the gap between renting and leasing cars, and it offers advantages over both service delivery models. Additionally, a car subscription provides the ability to switch out the subscribed vehicles many times and can enjoy the car without getting ownership of the car. Furthermore, the entry of global players into emerging markets adds to the growth of the market. For instance, in August 2020, Porsche launched a monthly Single-Vehicle Subscription (SVS) program in various cities in the U.S. including Los Angeles, Atlanta, San Diego, and Phoenix
AB Volvo, Assurant Inc., Tesla Inc., Cox Automotive Inc., Volkswagen AG, Toyota Motor Corp., Mercedes Benz Group AG, The Hertz Corporation, General Motors Co, Hyundai Motor Co. are some of the key players in the market. Several M&As along with partnerships have been undertaken by these players to facilitate customers with hi-tech and innovative products/technologies.
Insights Presented in the Report
“Amongst vehicle type, economy car category to witness robust CAGR during the forecast period”
Based on vehicle type, the market is segmented into a luxury car, executive car, and economy car. The economy car category is expected to witness higher CAGR during the forecast period owing to the growing penetration of ATVs from developing nations such as China, India, and Mexico, among others. Economy cars are adopted as subscription prices are affordable and have limited standards of fuel efficiency. Moreover, modern-day consumers are more open to paying their finances using digital channels due to which, the demand for vehicle subscriptions has increased consistently, particularly in developed regions.
“Amongst service providers, the OEMs to hold a significant share in the market in 2020”
Based on the drive type, the market is categorized into OEMs, mobility providers, and technology companies. Among these, OEMs hold a significant share in the market in 2020. This is mainly due to the low income and changing preference of the consumers to take a car on subscription rather than owning a car. Moreover, OEMs are working on subscription services and have great bandwidth and a pipeline of vehicles. The growing preference for the automotive subscription is increased as it has various benefits like low maintenance, affordable, monthly paying options, and less insurance costs. In addition, various key players are also showing interest which helps in the lucrative growth of the market in the forecast period.
“Amongst subscription period, 7-12 months category to witness robust CAGR during the forecast period”
Based on the subscription period, the market is segmented into 1 to 6 months, 7 to 12 months, and 13 and above. 7-12 months category to witness higher CAGR during the forecast period as the low subscription has various benefits as short-term automotive subscription services help consumers to enjoy car ownership without additional costs such as insurance, maintenance, and registration fees, and the subscription fees for the short-term period is affordable for the low middle-income population. In addition, the reduction in vehicle sales in the country due to rising vehicle prices is another factor boosting the adoption of automotive subscriptions from developing nations such as China, India, and Mexico, among others.
“Amongst end-users, private category to witness robust CAGR during the forecast period”
Based on the end-users, the market is segmented into business and private. The private segment category is to witness higher CAGR during the forecast period as the increase in the tours and travel with comfort. Moreover, for short-term use, the consumers don’t prefer to take the car permanently while as prefer to take the car on lease and pay comfortably from month to month.
“APAC to hold a significant share in the market”
In 2020, APAC held a significant share of the global automotive subscription services market. This is mainly due to the rapid urbanization, congestion in public transport, and growing disposable income of the populace are some of the factors responsible for the growth of the market. In addition, major global OEMs and service providers are planning to launch subscription services in Asian automotive market to grab early revenue growth opportunities in emerging countries such as China and India. Moreover, the growing prices of vehicles and middle-income consumers in these regions are also expanding the growth of the market.
Reasons to buy this report:
- The study includes market sizing and forecasting analysis validated by authenticated key industry experts.
- The report presents a quick review of overall industry performance at one glance.
- The report covers an in-depth analysis of prominent industry peers with a primary focus on key business financials, product portfolios, expansion strategies, and recent developments.
- Detailed examination of drivers, restraints, key trends, and opportunities prevailing in the industry.
- The study comprehensively covers the market across different segments.
- Deep dive regional level analysis of the industry.
Customization Options:
The global Automotive Subscription Services market can further be customized as per the requirement or any other market segment. Besides this, UMI understands that you may have your own business needs, hence feel free to connect with us to get a report that completely suits your requirements.
Table of Contents
Research Methodology for the Automotive Subscription Services Market Analysis (2022-2028)
Analyzing the historical market, estimating the current market, and forecasting the future market of the global automotive subscription services market were the three major steps undertaken to create and analyze the adoption of automotive subscription services in major regions globally. Exhaustive secondary research was conducted to collect the historical market numbers and estimate the current market size. Secondly, to validate these insights, numerous findings and assumptions were taken into consideration. Moreover, exhaustive primary interviews were also conducted, with industry experts across the value chain of the global Automotive Subscription Services market. Post assumption and validation of market numbers through primary interviews, we employed a top-down/bottom-up approach to forecasting the complete market size. Thereafter, market breakdown and data triangulation methods were adopted to estimate and analyze the market size of segments and sub-segments of the industry pertains to. Detailed methodology is explained below:
Analysis of Historical Market Size
Step 1: In-Depth Study of Secondary Sources:
Detail secondary study was conducted to obtain the historical market size of the automotive subscription services market through company internal sources such as annual reports & financial statements, performance presentations, press releases, etc., and external sources including journals, news & articles, government publications, competitor publications, sector reports, third-party database, and other credible publications.
Step 2: Market Segmentation:
After obtaining the historical market size of the automotive subscription services market, we conducted a detailed secondary analysis to gather historical market insights and share for different segments & sub-segments for major regions. Major segments are included in the report as vehicle type, service provider, subscription period, and end-user. Further country-level analyses were conducted to evaluate the overall adoption of testing models in that region.
Step 3: Factor Analysis:
After acquiring the historical market size of different segments and sub-segments, we conducted a detailed factor analysis to estimate the current market size of the Automotive Subscription Services market. Further, we conducted factor analysis using dependent and independent variables such as various vehicle types, service providers, subscription period, and end-user of Automotive Subscription Services. A thorough analysis was conducted for demand and supply-side scenarios considering top partnerships, mergers and acquisitions, business expansion, and product launches in the Automotive Subscription Services market sector across the globe.
Current Market Size Estimate & Forecast
Current Market Sizing: Based on actionable insights from the above 3 steps, we arrived at the current market size, key players in the global automotive Subscription Services market, and market shares of the segments. All the required percentage shares split, and market breakdowns were determined using the above-mentioned secondary approach and were verified through primary interviews.
Estimation & Forecasting: For market estimation and forecast, weights were assigned to different factors including drivers & trends, restraints, and opportunities available for the stakeholders. After analyzing these factors, relevant forecasting techniques i.e., the top-down/bottom-up approach were applied to arrive at the market forecast for 2028 for different segments and sub-segments across the major markets globally. The research methodology adopted to estimate the market size encompasses:
- The industry’s market size, in terms of revenue (USD) and the adoption rate of the automotive subscription services market across the major markets domestically
- All percentage shares, splits, and breakdowns of market segments and sub-segments
- Key players in the global automotive subscription services market in terms of products offered. Also, the growth strategies adopted by these players to compete in the fast-growing market
Market Size and Share Validation
Primary Research: In-depth interviews were conducted with the Key Opinion Leaders (KOLs) including Top Level Executives (CXO/VPs, Sales Head, Marketing Head, Operational Head, Regional Head, Country Head, etc.) across major regions. Primary research findings were then summarized, and statistical analysis was performed to prove the stated hypothesis. Inputs from primary research were consolidated with secondary findings, hence turning information into actionable insights.
Split of Primary Participants in Different Regions
Market Engineering
The data triangulation technique was employed to complete the overall market estimation and to arrive at precise statistical numbers for each segment and sub-segment of the global Automotive Subscription Services market. Data was split into several segments & sub-segments post studying various parameters and trends in the areas of vehicle type, service provider, subscription period, and end-user in the global Automotive Subscription Services market.
The main objective of the Global Automotive Subscription Services Market Study
The current & future market trends of the global Automotive Subscription Services market were pinpointed in the study. Investors can gain strategic insights to base their discretion for investments on the qualitative and quantitative analysis performed in the study. Current and future market trends determined the overall attractiveness of the market at a regional level, providing a platform for the industrial participant to exploit the untapped market to benefit from a first-mover advantage. Other quantitative goals of the studies include:
- Analyze the current and forecast market size of the Automotive Subscription Services market in terms of value (USD). Also, analyze the current and forecast market size of different segments and sub-segments
- Segments in the study include areas of vehicle type, service providers, subscription period, and end-users.
- Define and analysis of the regulatory framework for the Automotive Subscription Services
- Analyze the value chain involved with the presence of various intermediaries, along with analyzing customer and competitor behaviors of the industry.
- Analyze the current and forecast market size of the automotive subscription services market for the major region.
- Major countries of regions studied in the report include Asia Pacific, Europe, North America, and the Rest of the World.
- Company profiles of the Automotive Subscription Services market and the growth strategies adopted by the market players to sustain in the fast-growing market
- Deep dive regional level analysis of the industry
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