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How to subscribe to new cars instead of buying them




Ford's Canvas car subscription service lets drivers rent cars by the month for a cost of $400-500, including insurance, maintenance, registration and delivery. It launched in West L.A. in November 2017.
Ford's Canvas car subscription service lets drivers rent cars by the month for a cost of $400-500, including insurance, maintenance, registration and delivery. It launched in West L.A. in November 2017.
Canvas

Of the 17 million cars that are sold in the U.S. each year, about a third are leased. The rest are purchased. But there's a new option for drivers coming on strong in So Cal this year — car subscriptions.

Los Angeles resident Jeremy Irvine had always owned his cars, but recently, he said, "I figured out at 38 years old that I'm not a car person."

Now he's a car subscriber, driving a Ford Focus hatchback he pays for by the month through a service called Canvas. It costs him about $500 per month.

Ford Motor Co.

Irvine is like a small but growing number of people who need a car but would rather not own one. So they're subscribing – paying a monthly fee to access a portfolio of vehicles they can change when they want. The flat fee includes maintenance, insurance, roadside assistance plus dropoff and delivery. And the subscription can be ended at any time.

No hassles is the idea.

Irvine had been driving a BMW X5, "but I'd sort of decided I didn't want my car anymore," Irvine said. "I was on CarMax on my phone, and somehow Instagram knew I was on Carmax and started sending me ads for Canvas. I'd never heard of car subscriptions before."

Most people haven't. Naturally, Irvine was suspicious. He actually thought it was a scam. But it isn't. Car subscriptions a real thing. And they're set to take off this year even if they're only a tiny part of the market at the moment.

Flexdrive

"It's tiny," said David Liniado, with Cox Automotive. His company plans to bring its FlexDrive car subscriptions to an as-yet-unnamed car sharing company in L.A. in just a few weeks.

"The number of people that subscribe to mobility is probably in the 100,000 to 150,000 vehicle range," he said. But over the next 12 to 18 months, he said, "We are going to see those numbers ramp up very dramatically."

Several companies plan to offer car subscriptions in the L.A. area this year.

Volvo Car Group

 Volvo will offer its new Care by Volvo program with its all-new XC40 compact crossover in just a couple weeks. The Swedish auto maker says interest in the program so far is exceeding expectations, despite what might seem like a fairly steep cost. It's $600 per month, including the car, the tax, the insurance, and additional concierge services.

Volvo Car Group

 

 

Lincoln will also pilot a month-to-month subscription service in Southern California by summer.

Cadillac was the first company to offer car subscriptions in Los Angeles. Book by Cadillac launched in November 2017, giving drivers access to a curated portfolio of Cadillac vehicles and the option to exchange them up to 18 times per year -- for $1,800 per month.

"We felt it was really important to offer another way to access a luxury vehicle," said Melody Lee, global director of Book by Cadillac. Right now, the average age of a Cadillac owner is 62, but a Cadillac subscriber is 38 years old.

Lincoln Motor Co.

"Today's more traditional methods are financing and leasing," she added, "but we felt that in looking at the landscape of other industries and the way that consumers are choosing to access products and services, subscription is one that seems to be very popular."

In other words, just like people subscribe to music services like Spotify, movie rentals through Netflix – even fashion with a service like Rent the Runway – they can now use a car without needing to own it. And give it back when they're done.

Ford was next to market in SoCal. It launched Canvas in West L.A. last November and now has 600 subscribers in California. Canvas lets drivers choose from about a dozen different Ford vehicles, including the Mustang, and has the added perk of letting multiple drivers share a single subscription.

Porsche

And then there's Porsche. Its subscription – Porsche Passport – also launched last year, but it's only in Atlanta. For now. California being a top market for the German sports car maker, it's likely the Porsche Passport program will make its way here.

There are two plans. Launch -- for $2,000 per month -- includes on-demand access to eight models, including the Boxster, Cayman, Macan and Cayenne. The Accelerate plan -- for $3,000 -- upgrades the cars to 22 models that are interchangeable at any time, including the iconic 911.

So L.A., get ready to not own a car, like Jeremy Irvine, who's driven since he was 16 but just switched from owning to subscribing. "It's liberating," he said, "to not own something."

Even a car in car-centric L.A.