There has always been an inexplicable bond between a man and his car. As someone once said, “A love between a man and his car can only be understood by those who have felt it.” In earlier generations, the rite of passage was marked by owning a car, symbolizing freedom and independence.
However, the age of technology has changed this once enduring bond. Like the short-term relationship with the smartphone, people are now tending to treat their cars in a similar manner, ditching the long-term commitment for a shorter-term relationship. The reason is the cars of today are filled with tech gadgets that get outdated fast. This has led to a trend where more people are seeking to lease, than to buy, a car. For instance, in 2016, more than a third of all new-car owners leased rather than bought their cars. Leasing a car allows a driver to use a new or used car for a limited time span, generally three years. According to a recent Lease Market Report by Edmunds, the car leasing market has grown by 91% in the past five years, and is considered a significant factor in boosting new vehicle sales in the US. The report also traces an upward spiraling of car leasing volumes from 1.4 million in 2009 to 4.3 million in 2016. And, the leasing of vehicles, as it happens, is popular not only for personal cars but also for commercial vehicles.
With this perspective is born the need the for car manufacturers to consider themselves at the forefront of technological innovation. For instance, Daimler AG, the parent company of Mercedes-Benz has separated into three companies to enable it to become “fit for the future” by adjusting to revolutionary changes in customer demand.
The automotive business has come up with another option for people not looking to buy a car – they can get car subscriptions. This is not exactly leasing. Leasing gives people the opportunity to drive cars they cannot afford to buy. They pay a monthly sum to rent the vehicle, until the lease term expires. The difference with subscriptions, is the time frame involved. Subscriptions give people the opportunity to “own” the car on a month-to-month basis for a specific time period, depending on their individual needs. If a person needs a car for three months of the year, he can get a three-month subscription and own a car for those three months. The package will include insurance and, therefore, will save the subscriber the time and effort of hunting for insurance. But, unlike with leasing, there is no ownership possible at the end of the subscription period. This strategy appears to be a transparent approach to attract Millennials engaged in busy big-city lives, who have no desire to own a vehicle, but would like the convenience to get about when needed.
Contemporary city life all over the world is very congested and polluted. In trying to make the air more breathable, city authorities are clamping down on vehicle use in most cities. With this, the age of the automobile and the familiar concept of mass car ownership may be on the way to becoming obsolete.
The need to become greener has become a global outcry and the leadership of countries are trying to make it a reality. UK and France intend to ban the sale of diesel and petrol cars in 2040. Norway intends only selling electric and hybrid cars from 2030. The Netherlands will do the same five years earlier, from 2025 onward. Even developing countries like India and China are looking to go green with electric cars. The US is yet lagging behind in converting to electric cars. Yet, it can only be a matter of time before the whole world distances itself from fossil fuels. As American business magnate and investor, Elon Musk, said, “I could either watch it happen, or be part of it.”