Audi launches Car Subscription Service
So what does Audi On Demand get you? First of all, the service covers the taxes, maintenance, and insurance of the car you fancy. Available choices include the A4 sedan, A5 convertible, S5 coupe, as well as the Q5 and Q7 crossover utility vehicles. The subscriber can keep the vehicle it chooses for up to six months, and as an added bonus, subscribers can change to a different vehicle twice per month.
But wait, there’s more! Mentioned in the opening paragraph, Silvercar by Audi is included in the price for up to 24 days of rentals. On the flip side, Silvercar is available in 24 regions across the United States of America, making it far more mature as a service compared to On Demand.
Speaking to Automotive News, chief financial officer Matt Carpenter said that Audi plans to expand the program after drawing a conclusion from the five locations in the Dallas-Fort Worth metroplex. The economics of Audi On Demand, for example, “still need to be ironed out” according to Carpenter.
If all goes to plan, Audi could push forward with the expansion by the end of the year. On the other hand, dealers aren’t too fond of automaker-backed subscription services for all the right reasons.
One of the problems that rise up from this alternative to traditional leasing is profit margin. Cutting the franchise out of the revenue stream isn’t a viable business model for the dealership, which is why the California New Car Dealers Association forwarded a bill to the state assembly over “inappropriate treatment of dealers by manufacturers.”
As long as the automakers run the subscription services and own the vehicles, the sign-ups and transactions are bound to leave the dealer out of the action. Given time, however, these details are certain to be sorted out.
Source: Auto Evolution
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