Car brands use subscription model to reach younger drivers


These are tough times for vehicle manufacturers in the UK as they grapple with the impact of COVID-19, continued uncertainty about future trade relations with Europe, as well as a growing problem of an ageing demographic for new car sales.

It is estimated that the average age of a new car buyer in the UK is now 55, posing clear risks for auto brands that need to develop long-term relationships with their customers.

But one solution for long-term engagement rests potentially in a subscription model, which provides the flexibility that younger consumers increasingly demand in their purchase choices, whether that applies to livestreaming or big ticket items, reported Sifted.

Unlike traditional rental or leasing arrangements, some specialist car subscription companies don’t charge a hefty deposit or down payment – instead there is a one-time joining fee – and can offer a wide range of brands for a flat monthly fee.

Drover, a London-based startup, is one such firm whose founder and chief executive, Felix Leuschner, says the average age of its clients is 38 and that the arrangement with manufacturers “doesn’t really cannibalise their customer base at all”.

The company offers users a flat monthly fee of £568, including breakdown cover and servicing, and cars can be booked for between one and 24 months, which is slightly longer than an average car rental but shorter than a leasing agreement.

Drover benefits from bulk buy discounts offered by the car manufacturers, who in turn see Drover as marketing opportunity, allowing consumers to try before they buy.

Turning to specialist subscription firms may be the way to go for the car industry, since its own efforts to set up car-leasing and car-sharing subsidiaries have largely failed.

General Motors, for example, closed its Maven car-sharing service earlier this year, while Ford last year sold off its Canvas car-leasing business, and Mercedes-Benz cancelled a pilot for a car-sharing initiative in the US after experiencing low demand.

This article first appeared in

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