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Drivers are moving to a rental subscription as car prices rise

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High car prices and delayed orders are forcing drivers to switch to long-term car rental, according to Sixt car rental company.

The firm talks about the number of customers who use it subscription service since the pandemic has doubled as drivers seek to hire companies by car to cover their daily needs rather than for one-off events such as holidays.

Tim Wetters, managing director of Sixt rental, said: “We see a very strong trend of people using our cars in the long run – for us it is a significant shift.

“I think people get used to the idea of ​​buying a subscription, like Netflix and Amazon or even buying diapers. ”

“Most of the industry is struggling to get cars, so when we get cars, they’re more expensive … we have to ask our customers for higher prices to cover costs.”

According to the Society of Engine Manufacturers and Dealers (SMMT), car ownership declined by 0.2% in 2021, the first consecutive annual decline in property ownership over the past 100 years.

In May, Tesla chief Elon Musk warned the company may stop accepting orders for new cars as the growing disruption of the supply chain led to the fact that the delivery time was up to a year.

Suzanne Streeter, a senior investment and markets analyst at Hargreaves Lansdown, said: “Not surprisingly, subscription car rental services are becoming increasingly popular given the trends affecting the automotive sector.

“More motorists can also refrain from increasing the cost of cars and their environmental footprint and opt instead for road rentals, especially for what used to be a second vehicle for the home.”

SMMT data released in May showed that engine production in the UK in the first four months of 2022 fell to 537,355, down 19.2% from the same period in 2021.

42% of manufacturers say they are experiencing a disruption in the global supply chain, according to a survey by the Office for National Statistics Business Insights.

Sixt is the sixth largest car rental company in the UK with a market share of 14%, according to Stastistica. The company has 57 branches in the UK with a total fleet of over 10,000 cars.

Drivers are moving to a rental subscription as car prices rise

Source link Drivers are moving to a rental subscription as car prices rise

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