Car Subscription Global Market Report 2024

The car subscription market size has grown exponentially in recent years. It will grow from $6.21 billion in 2023 to $8.09 billion in 2024 at a compound annual growth rate (CAGR) of 30.2%. The growth observed during the historic period in the car subscription industry can be attributed to various factors, including a shift in consumer preferences towards more flexible and convenient mobility solutions, the impact of urbanization leading to increased traffic congestion, the rise of the sharing economy influencing the way people use and access vehicles, the emergence of innovative business models in the transportation sector, and the appeal of car subscription services that often include maintenance and insurance as part of the package.

The car subscription market size is expected to see exponential growth in the next few years. It will grow to $23.15 billion in 2028 at a compound annual growth rate (CAGR) of 30.1%. The anticipated growth in the forecast period for the car subscription industry can be attributed to various factors, including economic uncertainties influencing consumer preferences, increased environmental awareness driving interest in sustainable transportation solutions, the adoption of car subscription services as corporate fleet solutions, regulatory support encouraging the growth of alternative mobility options, and an ongoing focus on enhancing the user experience. Major trends expected in the forecast period include the introduction of flexible ownership models, integration with mobility apps and platforms, strategic partnerships with automakers and dealerships, offering trial periods and test-drive options to attract potential subscribers, and the utilization of data analytics for providing personalized and tailored subscription offerings.

The surge in popularity witnessed by car-sharing and ride-hailing services is anticipated to significantly propel the growth of the car subscription market in the foreseeable future. Car sharing involves a rental model where individuals borrow vehicles for brief periods, often hourly, while ride-hailing utilizes smartphone apps to request local drivers for transport to specific destinations. Car subscriptions play a pivotal role in these services, offering members a cost-effective, flexible, and convenient means of accessing vehicles. For instance, data from Zipcar Inc., a US-based car-sharing company, highlighted London's emergence as a popular car-sharing service hub, boasting over 500,000 subscribers by 2020. In London alone, nearly 87% of all car-sharing club participants in England and Wales reside. Notably, each vehicle within London's car clubs replaces an estimated 23.5 private automobiles. This trend underscores how the rising demand for car-sharing and ride-hailing services actively drives the expansion of the car subscription market.

The escalating issue of traffic congestion is poised to further drive the growth trajectory of the car subscription market moving forward. Traffic congestion manifests as slower speeds, prolonged travel durations, and increased vehicular queues, occurring when road or intersection capacity is overwhelmed by the number of vehicles. Car subscription services play a role in curbing car ownership and fostering carpooling initiatives, ultimately leading to a reduced vehicle count on roads and alleviating traffic congestion. For instance, INRIX Inc., a US-based company providing location-based data and software analytics, reported in January 2023 that the average American driver spent 51 hours in congestion, reflecting a 15-hour increase from 2021. This congestion cost individuals an average of $869 in lost time, up by $305 from the previous year, alongside higher fuel expenses amounting to an average increase of $129 for commuting. Hence, the mounting challenges associated with increasing traffic congestion actively fuel the expansion of the car subscription market.

The insufficient development of transport infrastructure poses a significant challenge that could impede the growth of the car subscription market during the forecast period. Inadequate transport infrastructure indicates a scenario where transportation systems and facilities within a particular region or area are inadequately constructed or underdeveloped, failing to meet the demands of the population, businesses, or the movement of goods and services. This insufficiency in transportation infrastructure may adversely impact the car subscription industry by hindering economic expansion, exacerbating funding shortages for transportation infrastructure projects, limiting consumer access to alternative transportation modes, and obstructing socio-economic advancement opportunities. For example, data from USAFacts in 2022 revealed a 21% decrease in spending on infrastructure and transportation compared to the preceding year. Consequently, the inadequacy of transport infrastructure stands as a significant impediment hindering the growth potential of the car subscription market.

Prominent companies operating within the car subscription market are actively engaged in the development of sophisticated digital platforms, particularly white-label technology platforms, to better cater to the demands of their existing consumer base. A white-label technology platform denotes a software solution initially developed and owned by one company but subsequently rebranded and sold by another entity. For instance, in June 2022, Banco Santander S.A., a financial services company headquartered in Spain, introduced Ulity, a white-label technology platform specifically designed to create subscription-based solutions for the mobility service industry. Ulity stands out by tailoring its solutions to accommodate businesses of various sizes and differing objectives within the industry. It enables these businesses to offer users immediate access to vehicles without any long-term commitments. The software empowers companies to create subscription-based solutions, reduce the cost associated with establishing automobile fleets, diversify existing fleets, enhance fleet longevity, and dynamically manage operations based on fluctuating demand trends.

In July 2023, Sixt SE, a prominent mobility services provider headquartered in Germany, completed the acquisition of Renti Plus for an undisclosed sum. This strategic acquisition empowers Sixt to assume control and augment its existing fleet with over 100 vehicles previously operated by Renti Plus. The collaboration expands the accessibility of the Sixt Plus service while enhancing the customer experience through the integration of Renti Plus' established car subscription platform. Renti Plus, based in Latvia, specializes in offering car subscription services, and this acquisition allows Sixt to further consolidate its market presence and improve its service offerings within the car subscription domain.

Major companies operating in the car subscription market report are Volkswagen AG, Toyota Motor Corp., BMW AG, Mercedes-Benz Group AG, Hyundai Motor Co., Nissan Motor Co. Ltd., Porsche AG, Volvo Car Corporation, Cox Enterprises Inc., Jaguar Land Rover Limited, Hertz Global Holdings Inc., Lyft Inc., Tata Motors Limited, Sixt SE, Onto Ltd., ZoomCar, Carly Holdings Limited, Canoo Inc., OpenRoad Auto Group, Clutch Technologies LLC, Facedrive Inc., Wagonex Limited, Cluno GmbH, Carvolution, MylesCar.

North America was the largest region in the car subscription market in 2023. Europe is expected to be the fastest-growing region in the forecast period. The regions covered in the car subscription market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa The countries covered in the car subscription market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The car subscription market includes revenues earned by entities by providing alternative to traditional car ownership, leasing, or renting. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The main types of service providers in the car subscription industry include original equipment manufacturers (OEMs) or captives, which are businesses involved in producing and selling goods or components used in products made by another business. Additionally, there are independent or third-party service providers in the car subscription market. Subscription periods typically vary, with options such as more than 12 months, 6 to 12 months, and 1 to 6 months. The range of vehicles available for subscription includes luxury cars, executive cars, economy cars, and others. Car subscription services cater to both private individuals and corporate clients.

The car subscription market research report is one of a series of new reports that provides car subscription market statistics, including car subscription industry global market size, regional shares, competitors with a car subscription market share, detailed car subscription market segments, market trends and opportunities, and any further data you may need to thrive in the car subscription industry. This car subscription market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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