BMW Slashes Entry-Level Price for Subscription Car Service

August 1, 2018, 4:28 PM UTC

BMW is expanding its test of a program to let customers subscribe to cars instead of buying them. And the minimum monthly fee to join the program just dropped from $2,000 to $1,100.

Much like subscription programs introduced by Volvo, GM’s Cadillac, and others, the BMW program lets a subscriber choose from among a variety of cars on a frequent basis and covers all related costs like maintenance and insurance. So far, BMW is only conducting a pilot in the Nashville, Tenn., area, with no announcement yet about plans to expand to more cities.

The original program introduced in April had two tiers. For $2,000 a month, subscribers to the “legend tier” could get access to cars in BMW’s 4 and 5 series. And for $3,700 a month, the carmaker gave access to its M-class cars as an “M tier.”

Under the revised program, a new, lower priced tier will start at $1,100 and offer access to BMW’s 3 series sedans, along with its X2 SUV and M240i convertible. Subscribers can swap cars as often as they’d like via a mobile phone app. The price of the legend tier drops 30% to $1,400, and the M tier price is cut 27% to $2,700.

The Access by BMW pilot copies the Cadillac program, called Book by Cadillac, that started in January 2017 at $1,500 per month. Porsche launched its own pilot last October that combines lease, insurance, and maintenance into one monthly payment. And Volvo has a similar offering at the more attainable price of $600 per month. Mercedes said last month it planned to launch a subscription program, too, with prices ranging from $1,100 to $3,000 a month.

The entire car industry is hoping to woo younger wealthy customers who have grown up with the convenience of on-demand mobile services like Uber and Airbnb. Unlike with a traditional car purchase, or even a lease, the subscription plans could keep customers on the hook for a seemingly unending stream of payments to stay in the driver’s seat.

Read More

Artificial IntelligenceCryptocurrencyMetaverseCybersecurityTech Forward