We pay monthly subscriptions for streaming services, meal plan deliveries and even clothing. So why not cars?
That's the question Bernie Moreno is asking.
"You don't own a home, you rent. You don't buy a vacation home, you go Air BnB," he said. "I don't buy a DVD, I stream it... That's really where the whole world is taking it. It just took a while for the car business to catch up."
Drive Options is a monthly subscription program launched by Moreno's string of luxury car dealerships.
Subscribers pay a monthly fee, then pick from a fleet of different high-end vehicles to drive for as long as they would like. With a simple click on the app, they can pick a Lexus, then trade it in for a Maserati, and then switch to a Porsche, all within the same month if they want. The dealership even delivers and picks up the vehicle at the customer's convenience.
Moreno says it allows customers to pick what they need at any given time -- convertibles in the summer, four-wheel drives in the winter -- and it keeps auto lovers from getting bored.
"Today is a rainy day, so maybe you want an SUV," Moreno said. "But Saturday is going to be a beautiful day, so you want a convertible... And then maybe next Friday, you're moving your son to OU, so you need a pickup truck. So the idea is you're not stuck to one type of vehicle."
The current program costs subscribers $975 a month, after a $575 joining fee. That will give subscribers access to cars ranging from $40,000-$60,000. The cost includes all insurance, maintenance and 2,000 miles of driving every month. Subscribers can cancel at any time.
"No financial responsibility other than putting gas in the car," Moreno said. "And making sure when you say you're going to return it that you return it."
Moreno says so far 20 people have joined since Drive Options kicked off on Feb. 23.
The company also plans to launch two higher tiers. One at $1,795 per month will offer vehicles $70,000+, and eventually a super premium level will be added for a selection of vehicles worth $100,000+, such as Aston Martin, Bentley and Rolls Royce.
While Moreno admits that it is currently a pricey luxury service, he hopes that down the road he can include a lower-priced tier (around $500 a month) that would offer mid-range sedans and SUVs to the everyday consumer.
He sees Millennials embracing the concept, once these subscription models become more affordable, and he doesn't see the trend slowing anytime soon.
"This is a microscopic part of the car business today as we sit here right now," he said. "But if you watch this in 10 years, it's probably going to be half of the car business that will be this subscription model."
