Volvo is enjoying higher-than-expected demand for its Care by Volvo subscription program.
The Swedish car manufacturer announced Care by Volvo alongside the XC40 crossover in November 2017. The program allows customers to subscribe to a new Volvo vehicle that bundles all car, insurance, and maintenance costs into a single payment varying between $650 and $850 per month for two years, which allows them to get a new ride after a year.
Fourth months after announcing the program, Volvo had sold all the subscriptions it expected to offer in the first 12 months. The company initially capped Care by Volvo subscriptions for the XC40 to 10 per cent of available vehicles but soon increased this to 15 per cent. New customers signing up to Care by Volvo for the XC40 have to join a wait list that stretches into 2019.
Speaking to Automotive News, Volvo Cars North America chief executive Anders Gustafsson said that Care by Volvo has tapped into certain demands from customers.
“It’s really the same concerns from everybody, and it’s just that they don’t feel secure. They’re afraid we’re going to take something away from them. … I would say the biggest question mark around subscriptions is that consumers need to decide that. Our retailers are asking, ‘Please let us be involved, because we can help,” Gustafsson said.
According to the executive, the car company is planning to increase the number of dealerships involved in the subscription program.
Word of Care by Volvo’s success comes shortly after it was confirmed that Cadillac would halt Book by Cadillac subscription service. Compared to the relative affordability of Care by Volvo, Book by Cadillac cost $1800 a month.