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Your Next Car Might Be A Subscription

As car companies see people willing to ditch their vehicles, they’re responding by offering more flexible options.

(photo-Volvo)

Instead of owning one car, what if you got whatever car you want, just when you needed it?Four-figure down payments, cumbersome lease lengths, and skyrocketing insurance costs: it’s enough to send a would-be car shopper running for an Uber or Lyft.

That’s why more automakers are rolling out flat-fee programs that aim to make leasing a car as simple as buying a smartphone. In a bid to keep potential customers from defecting to ride-hailing services and foregoing personal car ownership, brands like Volvo, Cadillac, and Porsche are upending the traditional retail model by developing app-based monthly subscription services that provide vehicles on demand.

When Volvo’s new XC40 SUV arrives at dealerships this spring, subscribers to the brand’s new Care by Volvo program will pay a minimum of $600 a month– depending on the trim level–for a package that includes maintenance, insurance, and 15,000 miles annually. They can switch to a new Volvo after a year or renew their lease for up to two more years. Taxes, gas, and registration fees are not included.

“We are seeing a new way of having a car,” says Volvo President and CEO Håkan Samuelsson. “That’s why we’re offering a flat rate independently of your age or where you live. People living in big cities normally pay a very high insurance fee.”