What is a car subscription and how does it work?
Volvo XC40 Recharge  These days were all quite used to paying for services via subscription. Streaming sites, music providers and even food suppliers can be done via monthly subscription and a rolling contract, allowing people the flexibility to pick and choose when they want a certain product. But up until reasonably recently, running a car via a subscription mightve seemed like an odd way of doing things. However, this method is gathering pace and even mainstream manufacturers like Volvo are joining in with their own offerings. Lets take a look at what a subscription is and how it could be ideal for your next car. In the same way that a subscription to a music service means you dont need to individually download and pay for each track, a car subscription service is a way of using a car without having to buy it. However, compared with other finance options, a subscription bundles all of the other expenditures associated with driving such as insurance and tax into one monthly payment, making it far less hassle. Audis e-tron is available via subscription service  >  Using a car via subscription is different to conventional leasing or financing in that its more flexible. So whereas a usual personal contract purchase might see you tied into a contract for a significant amount of time, a subscription service will allow you to cancel with a smaller amount of notice. Most suppliers run contracts of six, 12, 18 or 24 months  but some will offer shorter terms or even a rolling monthly one which will allow you to cancel whenever you like. It boils down to flexibility. If you know that you only need a car for a short period of time, then subscribing to a service will make far more sense than renting a car  itll be cheaper, too. Plus, many subscription services allow you to change your car more frequently, so if youre bored of the one youre driving you can swap to a different model more easily. Plus, you dont need to worry about insurance, tax or maintenance  all you need to do is pay for the fuel that goes in the tank. You do have to pay for the privilege of that flexibility. Youll see a slight premium over a conventional leasing contract because a subscription bundles all of the additional costs into one monthly payment. However, remember that when you sign up for a conventional finance deal, youll have to commit to a certain length of contract and also sort out those extras such as insurance and tax. For those who want a flexible transport solution, then a subscription could make a lot of sense. As weve already mentioned, Volvo was one of the more recent high-profile names to throw its backing behind subscriptions. In fact, Volvo recently stated that it expects 95 per cent of its retail business for its new electric XC40 Recharged to come through its Care by Volvo Fixed and Flexible subscription packages. The fixed plans cost 619 on a three-year term with no deposit, or 769 per month on an open-ended three-month rolling contract.