Subscription commerce is everywhere, and that includes via car rental company Hertz. It reportedly announced on Tuesday (June 4) that it is piloting a service called Hertz My Car.
The pilot will take place in Atlanta and Austin, Texas, according to a CNBC report, which said the monthly subscription service “is an alternative to traditional vehicle ownership, which the company said has become less popular in urban areas. It will cost subscribers between $999 and $1,399 per month, depending on which vehicle package they choose.”
Here’s how it works, according to that report: Customers will gain “access to various automobiles through the two subscription tiers and allow them to exchange vehicles twice a month for different models.” Under the subscription, vehicle maintenance, roadside assistance, damage and limited liability protection will all be covered.
One reason the car rental company wants to test vehicle subscription is that, according to a survey from Cox Automotive, “40 percent of respondents said that while access to transportation is necessary, owning a vehicle is not,” the report added.
As PYMNTS has covered, subscription commerce encompasses a wide variety of services, from Netflix to wardrobe curation to pet food delivery. So it’s no surprise that on average, according to the PYMNTS Subscription Commerce Tracker, Americans spent $2 billion per month on subscriptions in 2018. Globally, the subscription market is expected to be valued at more than $500 billion by 2020, which is why the competition is so fierce and why even more traditional businesses are getting into the game.
The subscription service model has expanded beyond digital entertainment and moved into other industries. In financial services, Charles Schwab has launched subscription-based financial planning products rather than taking a percentage of assets.
Food delivery, a still burgeoning service, has also been toying with subscription models. There has been recent speculation that Uber is going to introduce an Uber Eats Pass that will cost $9.99 a month instead of the 15 percent per order service fee. Rivals Postmates and DoorDash already offer similar subscriptions, Postmates Unlimited and DoorDash DashPass.