Automatic subscription: all the advantages and disadvantages.

“So, whoever commits himself forever, check if the heart can find the way to the heart; madness is short, regret is long” – many drivers know very well what Friedrich Schiller wrote about the risks and side effects of marriage. . The luxurious sports car you bought at a high price suddenly outgrows you because there are new kids on the way, the diesel SUV you love can no longer drive in the city center due to new traffic bans, or the cool car electric that takes you to the city on your first vacation trip in search of a free charging station Madness. The solution: simply get the right car for each purpose or situation in life. This is not a problem with a subscription model.

Car subscription: the right car for every purpose

This alternative to buying or leasing a car remains a niche with around 40,000 users, but experts in Germany expect up to a million subscription contracts by 2030. A car subscription works like this:

• For a fixed monthly base amount, you will receive a vehicle for a selected period of time. Some providers add an initial fee to the base amount.
• With a subscription you not only eliminate the purchase price of the car, but also many operating costs: taxes, insurance, maintenance and service, tires, etc. are covered by the provider. In addition to the fixed subscription fees, the user only pays for gasoline or electricity as a variable cost component.
• Car subscriptions are available through some manufacturers; for example the “Porsche Drive subscription” with a minimum duration of six months and a notice period of three months. Or you can take out a subscription with manufacturer-neutral providers, such as Sixt or FINN. Here you can choose from many more models.
• The typical term for a car subscription is several months to a year. You can also subscribe to the car for a shorter period of time and change the model periodically. This entails higher costs, but also offers maximum flexibility: a convertible in the summer, an SUV or family car for holidays, a small car to go to the city.
• Important: The shorter the term, the higher the monthly subscription costs. .
• With a subscription there is only a certain number of free kilometers per month.
• You have to pick up the car or have it delivered to your home for an additional cost.
• If you want to try an electric car without having to take risks such as a large loss of value, a car subscription is best for you.

Drive without financial risks

In fact, loss of value is one of the biggest underestimated cost factors when buying a car, and not just in the case of electric cars. “If you avoid the obligations surrounding your car and are willing to pay some additional fee for a comprehensive, worry-free solution, you will do well with a car subscription. If you like driving the latest models or want to try an electric car, a car subscription is also a good idea. The subscription model can be useful for workers as an alternative to the traditional company car,” advises the Autoclub Europe (ACE). And: “Similar to the work bike, you can subscribe to a car through salary conversion, so you don't incur taxes or social security contributions. This means you can save 50 percent compared to the normal subscription price,” ACE continued.

Gasoline, diesel, electric? A diverse fleet has advantages

While a Porsche subscription only offers expensive and powerful cars despite the different models, many providers offer basic cars. Before contracting a subscription, it is advisable to find out more about the available fleet. The ideal is to be able to choose between different types of propulsion (electric, hybrid, gasoline, diesel). . At Sixt, for example, you can switch between very different models:

• Small, compact cars with petrol engines (e.g. VW Polo, Golf, T-Roc)
• Electric and hybrid cars (Polestar 2, Lynk & Co 01, BYD Atto 3, Nio ET7)
• Family cars and SUVs (VW Passat, BMW X3 or X5)

Switching between models obviously affects costs. At Sixt, a VW Polo costs 419 euros per month, while a BMW 7 Series costs 1,459 euros.

FINN Auto also has a great selection:

• The smallest models are the Fiat 500 (from 349 euros per month) and the Jeep Avenger.
• With the Ford Focus, the Opel Astra and the Peugeot 208, classic “sensitive cars” are offered
• Electric models include Smart #3, Tesla Model 3, Fiat 500 and Polestar 2.
• The Mazda MX-5 is a fun roadster, as is the Mazda CX-60 large SUV (whether with a hybrid or diesel engine), a Nissan Qashqai or a BMW X6.

Who is the car subscription suitable for?

Advantages
Anyone who returns the car undamaged has full control of the costs because everything is included except the cost of fuel. The subscription is also interesting because the lessee receives a new or young used car without having to bear the purchase costs. Furthermore, there is no loss of value. Especially in times of electric mobility development, a car subscription can be an alternative to testing the new technology or waiting for it to be fully developed.

Disadvantages
Some providers charge initiation and registration fees, and the flat rate for free kilometers is usually small. An increase is relatively expensive. The minimum and maximum age for subscription must also be taken into account.

The advantage of not owning the car, as opposed to buying or leasing it and then owning it, is reversed when the car is returned. “At the end of the subscription, providers critically check whether usage traces exceed the usual level, which creates possibilities for disputes. Catalogs of limited samples provide clarification, using examples with photographs to show what is considered normal use,” advises the Autoclub Europa (ACE). At TÜV Rheinland you can see, for example, what a “border sample catalog” looks like (
direct link to PDF document).

What are the differences with leasing?

The terms are usually longer in the case of leasing, with the tenant committing to the vehicle for up to four years. Leasing is cheaper in terms of price, but it does not cover all car subscription services except fuel costs. . Those who value special requests sometimes benefit more from renting, since the cars can also be freely configured.

Conclusion

Anyone interested in a car subscription should ask themselves the following questions:

• How many kilometers do I drive per month? The more there are, the more expensive the subscription becomes due to the limited number of free kilometers.
• Do I want to try new technology before buying a vehicle of this type? This is a good option, especially with electric cars becoming more popular.
• Is it important for me to drive a new car but not have to pay the cost of a new car?

If you decide on a car subscription, in addition to the monthly installments and initial fees, it is worth clarifying the following costs in advance:

• Delivery and return costs.
• Deductible in case of accident
• What additional services are included (foreigner, second driver, cost per kilometer)