A World of Cars
in One Subscription

The automotive industry is reinventing itself. As it must. And not only in terms of the drive. Customers want independence, more flexibility, and less capital commitment. Suppliers are responding.


Minivan today, sports car tomorrow? The offer targets younger target groups—whether singles, couples, or families—to take out a car subscription on a temporary basis instead of vehicle ownership.Porsche Consulting/Thomas Kuhlenbeck

Peo­ple want to be mobile. The inven­tion of the steamship 300 years ago was a mile­stone. It was fol­lowed in 1825 by the first rail­road, then the air­plane and the automobile—and a car at your doorstep quick­ly became a sta­tus sym­bol. As a result of social issues such as sus­tain­abil­i­ty and cli­mate pro­tec­tion, as well as the devel­op­ment towards what is known as the shar­ing economy—the tem­po­rary lend­ing or shar­ing of vehi­cles, for example—the num­ber of peo­ple who have changed their demands regard­ing auto­mo­bil­i­ty has grown rapid­ly in recent years. And demand is trans­form­ing what is being offered. One of the new prod­ucts is the car subscription.

Sub­scrip­tion con­tracts for mag­a­zines, TV, and music stream­ing ser­vices are clas­sics. But does this also work for cars? The first providers of vehi­cles at flat-rate tar­iffs rolled onto the mar­ket in 2017. Ini­tial­ly, they were main­ly inde­pen­dent start-ups. Then Volvo, Jaguar Land Rover and a hand­ful of other man­u­fac­tur­ers fol­lowed. As a rule, the in-house finan­cial ser­vice orga­ni­za­tions at the man­u­fac­tur­ers’ head­quar­ters assume oper­a­tional respon­si­bil­i­ty. They are, as it were, the auto­mo­tive banks that tra­di­tion­al­ly han­dle vehi­cle financ­ing and leasing.

Con­ven­tion­al car rental com­pa­nies such as Europ­car, Hertz, and Sixt have also jumped on the band­wag­on. And it has picked up speed. Small cars such as the Opel Corsa and mid-size and lux­u­ry sedans such as the Volk­swa­gen Pas­sat and the Audi A4 are all avail­able on a sub­scrip­tion basis. But also sports cars like the Porsche 911. Demand for car sub­scrip­tions is grow­ing rapid­ly. Accord­ing to a Porsche Con­sult­ing esti­mate, in 2021 the num­ber of con­tracts con­clud­ed in Ger­many already exceed­ed 50,000. The prin­ci­ple: cus­tomers pay a flat month­ly fee for use of the vehi­cle dur­ing the con­tract peri­od. All costs are includ­ed in the month­ly install­ment: main­te­nance, wear and tear, gen­er­al inspec­tion, insur­ance, motor vehi­cle taxes. As a sub­scriber, the cus­tomer only has to pay for fuel—or elec­tric­i­ty in the case of an elec­tric car—plus a trip to the car wash and a refill of oper­at­ing supplies.

Dr. Marc Rieß, Managing Director and Chief Operating Officer at Porsche Financial Services, relies on close collaboration with the Porsche dealer organization for Porsche Drive products.Porsche Consulting/Jörg Eberl

What is the dif­fer­ence between car sub­scrip­tion and car leas­ing? First of all, the term of the con­tract is short­er: while leas­ing requires a com­mit­ment for at least twelve months, some car sub­scrip­tion providers entice cus­tomers with a term of just one month. Six- or nine-month con­tract peri­ods are also fea­si­ble. The cost per month for the car ranges from a few hun­dred euros to over 3,000 euros, depend­ing on the make and model. In the vast major­i­ty of vehi­cles avail­able, the equip­ment is already con­fig­ured. Changes are gen­er­al­ly not pos­si­ble. The terms of the con­tract and details such as reg­is­tra­tion fee, min­i­mum age (between 18 and 25 years, depend­ing on the provider), num­ber of addi­tion­al autho­rized dri­vers list­ed on the con­tract, deliv­ery peri­od, or mileage allowance are sim­i­lar to those for long-term rental cars. If a sub­scriber dri­ves more kilo­me­ters than agreed, they usu­al­ly also have to pay extra for these at the end. As with leas­ing, users do not own the vehicle.

But how do com­pa­nies ben­e­fit from this busi­ness model? The major­i­ty of sub­scrip­tion providers are more con­cerned with medi­um- and long-term goals in this new mar­ket. Many providers are cur­rent­ly invest­ing in these new busi­ness mod­els in order to find out how great the poten­tial is. A 2020 study by the mar­ket research insti­tute Puls reveals that the great­est appeal is for 30- to 50-year-olds; near­ly 40 per­cent of respon­dents in this age group find car sub­scrip­tion offers “very inter­est­ing.” The car sub­scrip­tion is also suit­able as a test mar­ket for elec­tro­mo­bil­i­ty prod­ucts, as some inter­est­ed par­ties use it to find out whether an elec­tric vehi­cle would make sense for them in day-to-day life. Vol­ume man­u­fac­tur­ers, who pro­duce mil­lions of vehi­cles a year, also use car sub­scrip­tions to give one model or anoth­er from their model range a lit­tle extra push. Leas­ing and car-shar­ing returns can also be remar­ket­ed through subscriptions.

Porsche Finan­cial Ser­vices (PFS) launched the first car sub­scrip­tion model for the Porsche fam­i­ly brand back in 2020. Along with address­ing addi­tion­al tar­get groups, PFS was also direct­ing a focus on estab­lish­ing a sus­tain­able and eco­nom­i­cal busi­ness model as an addi­tion­al pil­lar for the core busi­ness. Porsche Drive sub­scrip­tion ser­vice is intend­ed to give Porsche cus­tomers and prospec­tive cus­tomers an oppor­tu­ni­ty to “react flex­i­bly to chang­ing life cir­cum­stances while enjoy­ing the fun of dri­ving a Porsche,” says Christoph Köh­ler, Senior Con­sul­tant in the Mobil­i­ty Ser­vices divi­sion at the man­age­ment con­sul­tan­cy Porsche Con­sult­ing. Togeth­er with his col­leagues, he assist­ed the auto finance experts at the sports-car man­u­fac­tur­er’s PFS sub­sidiary with the subscription.

Interview with Marc Riess

Fulfilling dreams on time

Dr. Marc Riess is Managing Director and Chief Operating Officer of Porsche Financial Services GmbH- a wholly owned subsidiary of the sports car manufacturer Dr. Ing. h.c. F. Porsche AG. In an interview with Porsche Consulting Magazine, Riess describes what is special about Porsche Drive subscription. 
"Some people may opt for a subscription first, lease a Porsche later, and then buy one," says Marc Rieß.Porsche Consulting/Jörg Eberl
Porsche Financial Services launched Porsche Drive subscription in August 2020. How has this new offer been received since then? Very well. We started with small steps. These included, for example, the introduction of new processes and extensive dealer training. As our partners and guarantors of quality, the operators of the Porsche Centers also play a particularly important role for Drive subscription. We have already acquired many customers. We're hoping to see significant increases in 2023 and the following years. The greatest demand for the program is currently for the 911 and Taycan model series. What distinguishes Porsche Drive from other subscription car models? Using the "Porsche Finder" online platform, interested parties and customers can select their desired vehicle from a wide range of immediately available models in our inventory, reserve it and subscribe to the vehicle via their local Porsche Center. For a monthly package price, we enable the vehicle to be used in many European countries, even by a second driver. All maintenance costs are covered, as well as, for example, our mobility service, Porsche Assistance. This helps in the event of a breakdown or accident. The Porsche Drive subscription also includes the Connect "Navigation & Infotainment" package. Only the costs for refueling or charging are in addition to the package price. The local dealer is fully involved, providing advice and is available as a competent contact partner alongside Porsche Financial Services throughout the entire term. Simple and flexible access to our Porsche vehicles without long-range terms is also available with our new "Porsche Drive Flex" product. As part of a pilot project, we are offering our customers the opportunity to change their Porsche model on a daily basis with a lead time of two working days in each case, at a monthly package price and with a minimum term of three calendar months. What goals is Porsche pursuing with its car subscription offer? Market studies have shown that this segment has great potential. That is why we do not want to stand on the sidelines in this promising business area, but rather contribute our strengths and create additional added value for our customers. Our approach is to introduce a new and younger generation of customers to the Porsche brand with Porsche Drive subscription and Porsche Drive Flex. What is your forecast for the young car subscription market? Its development has been very dynamic since 2018. We expect significant growth rates not only in Germany, but also see potential in the USA and China. With our offerings, we are ideally positioned to offer our customers added value there as well.

Porsche relies on a min­i­mum term of six months, with a notice peri­od of three months. The cost of the sub­scrip­tion depends on the model and its equip­ment. For the Porsche 911, for exam­ple, these costs range from 2,800 to 3,500 euros.

Porsche Con­sult­ing sup­ports the Stuttgart-based sports-car man­u­fac­tur­er in devel­op­ing inno­v­a­tive busi­ness mod­els. Christoph Köh­ler says, “We assist Porsche with car sub­scrip­tion along the entire value cre­ation path.” Porsche Con­sult­ing is suc­cess­ful because it is able to test new ideas direct­ly on the mar­ket. “Our Ser­vice Devel­op­ment approach allows us to val­i­date inno­va­tions on the mar­ket with real cus­tomers with­in just a few weeks, with­out cre­at­ing a direct link to the brand,” explains Köh­ler. In addi­tion, Porsche Con­sult­ing’s exper­tise in the auto­mo­tive world enables it to pro­vide analy­ses and opti­miza­tion, pre­pare busi­ness cal­cu­la­tions, and sup­port the estab­lish­ment of agile prod­uct organizations.

Porsche, a pre­mi­um sup­pli­er, has con­tin­ued devel­op­ing its sub­scrip­tion model in the inter­im. A sec­ond busi­ness model pil­lar has emerged: Porsche Drive Flex. What’s par­tic­u­lar­ly attrac­tive is the free choice of model dur­ing the sub­scrip­tion peri­od: 911 today, Cayenne tomor­row, Tay­can the day after. As Christoph Köh­ler notes, “Whether it’s the way to the office, week­end dri­ving plea­sure, a fam­i­ly out­ing, or a road trip with friends—the cus­tomer has max­i­mum flex­i­bil­i­ty, can change vehi­cles quick­ly and eas­i­ly with­in the ver­sa­tile fleet.” The fixed month­ly price comes to 2,899 euros. The min­i­mum term for Porsche Drive Flex is three months, and the notice peri­od is one month.

Porsche Financial Services

Responsibility for all Porsche mobility services is bundled at Porsche Financial Services. The wholly owned subsidiary of the Stuttgart-based sports car manufacturer is steadily expanding its flexible mobility models. The focus is on simple and flexible access to vehicles without long-range terms. The range also includes customized leasing and financing offers for Porsche vehicles and the exclusive Volkswagen brands Bentley, Lamborghini and Bugatti, as well as dealer financing, insurance and credit cards. The company operates internationally with more than 600 employees and manages more than 320,000 leasing and financing contracts worldwide (as of 2022).
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