Owning a car like you own a phone? (New Volvo Content)

So this is the new Volvo XC40, basically Volvo's answer to the Mercedes GLA and Audi Q3. It will start around $35k for the T5 AWD with a cheaper T4 model coming later. It's also available with orange carpets because why not?

Actually, the big news here is that in addition to being able to finance, lease or just straight-up buy the car, Volvo will give customers the option to own it like they own a cellphone. Care by Volvo bundles the car payment, insurance, maintenance, taxes, etc. into one monthly payment, so the only thing an owner would have to worry about in addition to the payment is gasoline. After 24 months, the car goes back and then the owner can choose to continue on the plan, but with a brand new model. In addition, if someone on the Care by Volvo plan needs 7 seats because family is coming to visit, or wants a swanky sedan with a swooping roofline for a night out, they can borrow other Volvos from the range. Pretty interesting concept, eh?

It'll come down to what the cost is, if there's mileage restrictions in a lease type fashion, and what the procedures are for major repairs if Care by Volvo work or not. I don't think I've seen any of those mentioned.

I'm always a bit skeptical of the whole "It's new (or disruptive) because you can do it on a phone now."

That said the XC-40 is priced and sized firmly in CX-5 territory, so it's a potential contender for a replacement for SWMBO's X-Terra when that time comes.

The aerospace industry has been doing CARE or Power By the Hour programs for years.... 

Similar to http://www.pwc.ca/en/service-support/general-aviation-pay-by-the-hour

Very interesting. I think this is the way most manufacturers will be (or are) going. Here in South eastern Michigan where something like 80% of the people work directly or indirectly for an auto company or supplier, very few people purchase anymore anyway. Everybody leases and mostly short term like 24 months. Generally a few months prior to the lease termination the manufacturer offers an early out into another lease.  And so on.  A good friend of mine leased his 16 year old daughter a brand new Jeep Compass for $79 a month. He said it was cheaper to go that route than buy her a used vehicle. In two years on to the next one.  He works for Chrysler and the plan he has includes insurance as well. Hard to beat.

It still hurts my head to realize China, Inc owns Trolhätten's finest.

(our new emojis suck)

And, they also own Gothenburgs finest.

I've wondered why automakers haven't really done this(much) yet. In the copier world you typically pay a per-copy rate, that sometimes includes the equipment lease, maintenance/repair, toner/ink and paper. If I could walk into a new car dealership and know from the start I'd be paying $.35-$.75 per-mile to drive a certain vehicle over a fixed period of time, and not have to worry about anything except gas, that would be great.

I'm naturally scruffy. That doesn't mix well with leases 

Cool...One more way to convince people to unnecessarily throw money out the window in the name of keeping up with (or being) the Jones'.  No matter how well they hide the extra costs to the consumer, they'll still be there.  The only ones who will reliably come out ahead financially here will be the auto manufacturers, and possibly the dealerships.

With the ever growing prices of new cars, coupled with how fragile they can be when consider the sheer magnitude of their electronics on board, I am surprised somebody did not do this before.

And I like the orange carpets

I mean with leases already with maintenance and the like this does not seem that far fetched. And many people subscribe to the always have a lease payment of X amount of dollars and trade in every 3 years anyway

Like a lease it comes down to depreciation

As many have said, I'm surprised something like this hasn't been offered already. A program like this would really work nice for SWMBO, she doesn't drive much and we are looking at her next car possibly being a lease.

it would work well for my mom, she only does about 50 to 75 miles a week, the majority of that is with me behind the wheel when I take her out to breakfast on wed, then out to do her shopping

Aside from the mildly odd car thingie, I do quite like the looks of that thing.

I've been saying this would be the trend for years. As the amount of electronics in vehicles increases so does purchase price, but they also become obsolete faster. Fewer and fewer people will be willing or able to buy high tech vehicles only to have them depreciate like a rock when the newer model comes out and their tech laden, mobile living room can no longer sync with their new phone. It makes sense for car companies to try this, as it should be highly profitable and will ensure that even if people aren't willing to buy vehicles outright, the manufacturer still has strong revenue streams.

Volvo is not the first to try this however, although they seem to be implementing it on a larger scale than others. Cadillac currently offers their BOOK program in NYC. For $1500/ month you can request any new Cadillac be delivered at your leisure. If you normally drive a CT-6, but want to do a track day this weekend, you can request a CTS-V or ATS-V. Family road trip coming up? Have an Escalade delivered to your door 24/7. Insurance and everything is covered in the monthly fee. Audi offers short term rentals on their line up in select cities,and BMW had a similar program in the past too, but they no longer offer it.

Sort of like long term zipcar but in your driveway. well zipcar also pays the gas.

There are several iterations of this currently.  Its currently ridiculously expensive and marketed to the top 5% for sure.  I think it will slowly trickle down to cars for the masses.

Personally, I hate it because its the opposite of BIFL.  

(I don't own my phone that way either)

STM317 said:

Fewer and fewer people will be willing or able to buy high tech vehicles only to have them depreciate like a rock...

This does absolutely nothing to avoid that inevitability though.  You're still paying for that same depreciation either way.  This just 'hides' it out of sight and out of mind...For a 'nominal' additional fee, of course.

In reply to ProDarwin :

Heh, and I was busy thinking, "geez, a 2-year commitment? That's a looooooong time to have a car!"

I've been thinking for some time that car subscriptions are going to be in the cards. With car makers claiming you don't own the software in your car it's not a stretch to not sell them on the new market. A little more of a challenge for manufacturers on what to do with used ones to recoup the residuals if this sort of sidesteps dealers.

In reply to oldtin :

I think dealers will still have a place. I think they'll just transition into a hub where vehicles will be stored, maintained, and detailed while they wait to be hailed. As far as I can see, thats the fastest way for a car company to expand a service like this.

Driven5 said:

STM317 said:

Fewer and fewer people will be willing or able to buy high tech vehicles only to have them depreciate like a rock...

This does absolutely nothing to avoid that inevitability though.  You're still paying for that same depreciation either way.  This just 'hides' it out of sight and out of mind...For a 'nominal' additional fee, of course.

100% correct. Just like financing anything else really. If you can't afford to purchase it outright, they'll offer the same thing or something similar in monthly fees, but it will cost you more in the long run.

I think this is more or less an exercise to prepare consumers for an autonomous future where fewer people own or lease their own vehicle, and most vehicles are just shared public transportation.

I can see this working for some folks, but not me.

I also buy my phones outright--- I see no need in having the shiny new toy, when my old toy works just fine.

I used to be in the "buy phone outright" camp.  Then they started offering 0% financing on them.  At that point, it's stupid not to take the offer, spread the cost over 2 years (for the same total cost) and then the phone is mine at the end, no need to replace it right away.