Loopit’s says the rise in car subscriptions in 2021 comes as customers become increasingly wary of taking on new debt in the wake of the pandemic, aligning with predictions from Forbes that car subscription is set to become one of the top global automotive trends for 2021.
According to Loopit, it has experienced tremendous growth since first launching in early 2019.
Loopit allows consumers to ‘subscribe to drive’ any car at their local dealership for an what they say is an affordable recurring payment.
The business now has cars available in all Australian states, and also recently announced international expansion, partnering with New Zealand’s vehicle distribution and dealer group, The Giltrap Group and global car rental giant SIXT.
“It is an enormous achievement to reach 6,000 cars available for subscription across the Loopit network in such a short space of time, and in spite of the stock shortages currently being experienced across the automotive industry,” said Michael Higgins, Co-Founder and Managing Director at Loopit .
“This growth has been underpinned by a surge in consumer demand for car subscription, and those dealerships that have embraced the subscription model are now reaping the rewards with an influx of new customers.”
According to Higgins, while Loopit has experienced record growth, OEM subscription programs from BMW and Audi have struggled to find success in their respective markets.
Higgins says, however, that this was not a reflection on the viability of subscription but an example of some OEMs “failing to realise the expertise needed to build a successful program - without experience in the subscription market, their pricing and models didn’t target the right consumers”.
“Our existing partners have recognised that being able to operate a subscription program efficiently and at scale is critical to success. Many OEM and dealership providers that attempt to launch their own internal solutions don't anticipate the nuances of car subscription and the level of administration that is required. To succeed, they need an experienced partner with a purpose-built solution.
“By largely automating the administration process and making this more efficient, Loopit allows OEMs, dealerships and rental companies to concentrate on delivering an exceptional customer experience with bank-like levels of customer service. Based on the current performance of the automotive industry and our first-hand experience, we’re forecasting that car subscription will continue to rise on the back of increasing consumer demand and wider availability.”
