COMMENT: Subscription models point to the future of car ‘ownership’

The subscription-based business model has risen to prominence in recent years. It was originally pioneered by magazine publishers and later by consumer goods companies like Gillette, selling at a low margins, or even at a loss on one-time product sales, but making higher profit margins of 50-70% on recurring or subscription sales. Recently, this has been taken to the next level by companies like Netflix and Amazon.

The automotive industry is also seeing the start of a notable shift towards ‘access not ownership’. Flexible leasing models are being replaced by even more flexible vehicle subscription models. OEMs that have already announced subscription