Automotive Subscription Services Market Size Is Accounted to Hold US$50.8 BN In 2028 - Alchemy Market Research

 The automotive subscription services market size is expected to reach over US$50.8 billion by 2028. The market is witness to significant growth owing to the increasing demand for flexibility to choose a wide range of vehicle models at a fixed cost for a shorter period of time. In the past years due to cost-effectiveness and convenience associated with the subscription services has increased the demand for automotive subscription services market. The Automotive Subscription Services report further mentions that the market size stood at US$ 3.2 billion in 2019, and it is likely to exhibit a CAGR of 41.2% during the forecast period 2020 to 2028.

The Increasing Demand for Automotive Subscription Services

The demand for automotive subscription services is increasing due to choosing a wide range of vehicle models at a fixed cost for a shorter period. The demand for automotive subscription services has increased significantly during the past years due to cost-effectiveness and convenience associated with subscription services. In automotive subscription services, customers need not pay any extra charges for vehicle insurance and maintenance along with roadside assistance. These days’ customers are demanding some extra services due to which the automotive subscription services market is expected to witness tremendous growth throughout the forecast period 2020-2028.

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Increased prevalence of Subscription Services

The increasing automotive vehicles prices in addition to additional maintenance and insurance costs enable consumers are inclined towards vehicle subscriptions. The low financial liability equated with vehicle subscription compared to vehicle ownership is assisting the market demand. Automotive subscription services also allow consumers to differentiate between multiple vehicle models during the subscription. Nowadays, some markets are providing subscription services to consumers as a result consumers are going to purchase products they want to purchase. Similarly, in the automotive industry consumers prefer to purchase high cost vehicles on subscription services which they cannot afford due to high cost of these vehicles. The demand for the automotive subscription services market is expected to rise during the forecast period.

Alchemy Research and Analytics LLP had taken the impact of the ongoing COVID-19 pandemic on the Automotive Subscription services market for the year 2020 and 2021. As per our extensive secondary and primary research, the demand for automotive subscription services has decreased in the COVID-19 period owing to sudden lockdown and consumer’s preference to not spend much amount on unnecessary items. In the post-COVID-19 period, automotive subscription services will become more popular as consumers will prefer personal vehicles to public transportation. The automotive subscription services market is expected to rise in the forecast period.

Key Manufacturers Aim to Enhance Their Portfolios by Partnerships

According to Alchemy Research and Analytics major market players in the automotive subscription services market are focusing on strategies such as partnerships, collaboration, acquisitions, and mergers to enhance their geographic presence as well as product portfolio. The automotive subscription services market is highly fragmented.

Alchemy Market Research lists out the names of key market players in the automotive subscription services market. They are as follows:

• AB Volvo
• BMW AG
• Cox Automotive Inc.
• Daimler AG
• Mercedes Benz
• Fair Financial Corp.
• Flexdrive Services LLC
• General Motors Co.
• Hyundai Motor Co.
• Tesla Inc.
• Volkswagen AG

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DoC: https://issuu.com/alchemymarketresearch/docs/automotive_subscription_services_market.docx

Market Trends

The major trend of the market is the increasing usage of smartphones and internet penetration is driving market growth. Market players are developing advanced automotive electronics components by adopting machine learning and artificial intelligence. In the future, the demand for subscription services is expected to rise due to technological advancement in the automotive industry. The availability of subscription services will facilitate affordability for customers. Software aggregators and third-party service providers together with manufacturers are introducing subscription services. These are the major trends due to which the market is expected to grow in the forecast period.

Market Drivers

One of the major factors which are driving the growth of the automotive subscription services market is providing a wide range of vehicles under a single subscription service. Technological advances in automobiles, growing demand for car leasing services, rising penetration of third-party, automotive subscription service providers are other drivers that boost the market growth. Stringent government regulations regarding emission control, lack of proper public transportation infrastructure in developing countries, and due to COVID-19 impact the market is expected to grow throughout the forecast period.

Market Challenges

The major challenges in the automotive subscription market are inadequate transportation infrastructure and high monthly charges for the short-term subscription which is estimated to hamper the growth of the global market.

A Significant Industry Development-

• February 2020: Mercedes Benz added automaker’s high-performance AMG models in its collection subscription services. Subscribers to this tier will get access to 11 models, including sedans, coupes, roadsters, and SUVs “powered by AMG’s signature handcrafted V8 engines.

Further Report Findings-

• North America accounted for the highest share in the global automotive subscription services market in 2019 due to well established automotive industry in the region along with the presence of the key players in the region.
• Europe is expected to witness a significant market share in the automotive subscription services market due to the substantial proliferation of subscription services and the presence of major automotive producers/manufacturers such as AB Volvo, and Volkswagen.
• Based on subscription period, the global automotive subscription services market is bifurcated into 0-6 months, 6-12 months, and more than 12 months The 0-6 months category accounted for the highest share and had more than 40% of the market revenue share in the same year. This is ascribed to the growing popularity among consumers for short-term vehicle renting services worldwide.

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