Stock - Car Subscription
With a car subscription service, you get to change your car every 30 days. But is it worth your money? Image Credit: Stock

Dubai: Wouldn’t it be great if your car insurance, car repairs, roadside assistance, and fees were all included in one convenient monthly payment?

Car subscription services are an alternative to leasing that provide the use of a car for an all-inclusive monthly fee, which usually covers insurance, maintenance and roadside assistance. Car subscriptions are fitting right in at a time when a younger generation of users prefer 'on-demand' mobility than buy a car.

Globally, research indicates that the car subscription category could end up representing 40 per cent of all new car sales and grow into a $40 billion (Dh147 billion) market of its own.

Car subscriptions in the UAE are tracking a global trend
Digital platforms offering monthly car subscriptions and dealerships in the UAE have been working together to latch on to a trend likely to pick up some serious momentum in the next two to three years, analysts reveal.

This way, they are trying to overtake the traditional car rental market – as well as offer another option to residents who have been using ride-hailing services via apps.

In some key markets of Europe, carmakers have directly gotten into the car subscription business as individual ownership rates come down significantly.


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Car subscriptions in the UAE are tracking a global trend

What is the difference between renting and subscribing a car?

At the end of the day, isn’t renting a car and subscribing for one serve the same purpose, as far as the user is concerned? Not necessarily.

The main difference between a car subscription and traditional rental is the duration.

There's generally a maximum length for a rental term, ranging from a couple of weeks to several months, whereas subscription services are designed to carry on for as long as you need them.

Rental companies try to lock customers to the same car for longer periods. With a subscription, you can swap your car every 30 days.

Moreover, the vehicle you subscribe to is the exact vehicle you will receive. So you not only choose a model, but also the colour, trim (version or model) and other specs.

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What is the difference between renting and subscribing a car?

What are the advantages of subscription services?

The major advantage of car subscription services is the all-inclusive monthly payment that consolidates the usual costs of owning or leasing a car.

Key perk of car subscription services: All-inclusive monthly fee
Some subscription services offer all-inclusive packages so you can consolidate all of your auto-related expenses in one place.

Granted, you still have to cover the cost of fuel and pay a Dh500-Dh1,000 deductible if you’re ever involved in an accident, but everything else may be included in that single price you pay each month.

Of course, that convenience factor comes at a price. You may pay as much as Dh1,900 per month for a luxury car or as little as Dh400 per month for a small, low-cost car.

Additionally, most subscriptions come with the convenience of vehicle delivery and pickup, so you never have to leave your home to swap vehicles.

A notable perk of some higher-end subscription services is the ability to swap vehicles on an unlimited basis, giving you the freedom to choose the car you want and the length of time you want to drive it.

So essentially, subscriptions are great for drivers who get bored easily and want a change of pace with the car that they drive.

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Should I join a car subscription service?

What are the disadvantages of subscription services?

The major disadvantage of car subscription services is the amount you’ll pay for their aforementioned convenience.

Surveys indicate that subscription services cost about 28 per cent to 102 per cent more per month than the cost of leasing, insuring and maintaining an equivalent vehicle.

However, this also doesn’t account for the fee to join a program, which is typically a few hundred dirhams at least.

Additionally, many of the more affordable programs have monthly mileage restrictions that you must abide by and don’t give you the freedom to change cars on a whim.

Verdict: Should I join a car subscription service?

If you have the necessary disposable income and the soul of an enthusiast, a subscription service can make sense. You can continuously upgrade to the latest models or swap vehicles as you please.

However, if affordability and practicability are important to you, you’re better off leasing a vehicle because it’s highly likely that you’ll pay a significant amount less with a lease.

What are the disadvantages of subscription services?

Key takeaways

On a long enough timeframe, leasing a car would be much more affordable than subscribing to a car service.

This is why car subscriptions are primarily suitable for select groups of people, like those who want to change cars more frequently, those who need a car in a hurry, and those who will only be in a particular location for a brief period of time.

As with car ownership, the nicer and newer the car is, the more expensive it’ll be to borrow it through a subscription program. As tempting as it might be, it’s important not to get carried away with upgrading to newer cars all the time, as this can drive up your lifestyle costs.

So, is a car subscription really a preferable alternative to taking out loans for a depreciating asset? The answer depends on how often you drive, what type of car you want, and whether you value convenience over affordability.