A subscription is a traditional economic arrangement by which goods(such as milk jugs) or services(such as news articles) are sold periodically. Netflix, which has 167,000,000(2019) members, is one of the examples that show how this business model has expanded - to music or movie streaming services.
Subscription services not only provide commodities or services but also curated content that is personalized for each subscriber.
Vehicle Subscriptions Are Changing Consumer Behavior
Cars, which seemed to be forever in the private ownership realm, have entered the sharing era. These monthly vehicle subscription services allow their customers to switch to different models they want to drive, without needing to care about taxes, insurances, or maintenance.
These vehicle subscription services are growing fast. 'Book by Cadillac' operated by Cadillac, 'Care by Volvo' by Volvo, 'Porsche Passport' by Porsche, 'Access by BMW' by BMW, 'Kinto One' by Toyota, 'Hyundai Selection' by Hyundai, 'Genesis Spectrum' by Genesis, and 'Kia Flex' by Kia are currently on the list.
So, who's subscribed to Hyundai Selection? Hyundai Motors has been operating the beta service from January 2019 to February 2020. 2015 members gathered, with 50% in their 20s and 30s. These are millennials, who are pretty much used to subscriptions. They found Hyundai Selection highly pragmatic since Hyundai took care of all the taxes, insurances, and maintenance.
The accumulated number of subscribers is 225. The average age is 43, and 76% of subscribers were in their 30s or 40s. The average subscription length was 3.2 months. While most of the members were in their 20s or 30s, most of the subscribers were in their 30s or 40s.
The biggest advantage of subscription, according to a customer survey, was that the members can cancel their subscriptions anytime they want. This means, apparently, that the best part was no minimum subscription was required. Half of the users said they were happy to try the models they wanted before they actually buy, and 28% of the subscribers said they were satisfied with being able to switch cars.
Hyundai Selection Upgraded: Curation Service
Here's the biggest change that Hyundai Selection has made. Unlike its previous beta version, the official service includes Basic, Standard, and Premium type to satisfy a wider range of customers. Also, the service has been expanded to the metropolitan areas - Gyeonggi, Incheon, including Seoul.
The basic member can choose either All-new Elantra or Venue for 590,000KRW every month, and also may change the model after one month of subscription. The standard membership includes All-new Elantra, Venue, Sonata, and Tucson for 750,000KRW per month, and the members can use two models at the same time. The standard member can also assign one additional user.
The premium membership includes all the four previously mentioned models above, plus Grandeur and Palisade. For 990,000KRW per month, the member can use three cars at the same time, with assigning two additional users. Unlike other long-term car rentals, any membership of Hyundai Selection offers unlimited mileage.
Hyundai Selection, Better Than Car Rentals or Sharing Services
Hyundai Selection’s subscription vehicles include the upper trim models, unlike the lowest trims which are included in the car-sharing and rent-a-car services. For premium members, Hyundai Selection offers cars that include Lane Following Assist, cruise control (fixed speed driving assistance device), Highway Driving Assist, Rear-Cross Traffic Collision Assist, and other latest specifications. All-new Elantra and Sonata feature the Digital Key, which allows the driver to use a smartphone to unlock the door and start the engine.
Hyundai Selection is more cost-effective than other long-term rental programs. If you want to hire All-new Elantra for 24 months, you need to pay 593,000KRW every month. Hyundai Selection, on the other hand, costs 590,000KRW for a monthly subscription, and unlike other rental programs, you can change vehicles during the period. If a facelift model is released on the market, you can also get an upgrade. Also, unlike other long-term rental services, there is no mileage limit for Hyundai Selection subscribers.
Hyundai Selection becomes much more attractive when compared with other car-sharing services. The subscription price is almost half of the car-sharing service, regardless of vehicles. Another advantage of Hyundai Selection is that they simply have more options, including upper trim models.
What’s Next For Hyundai Selection?
Hyundai Selection is about to expand its lineup including the High-Performance N models, and will also feature other services such as the Last Mile or parking subscription, all coming out in May.
According to the global consulting firm McKinsey, the subscription economy has doubled every year for the past five years. The automotive subscription market, too, would grow with more detailed and personalized programs and reasonable prices. The new Hyundai Selection coming out this month will change our mobility life once again.
