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Volvo's Subscription Service Already Has A Waiting List

Industry News / Comments

It looks like Volvo has excelled where Cadillac has failed.

America's go to luxury automakers, Cadillac and Lincoln, haven't had success with their subscription services. Book by Cadillac experienced a lack of inventory, so the company decided to cancel the service, while Lincoln couldn't attract enough users for its used car Canvas service.

This doesn't mean subscription services themselves are the problem, as Porsche is currently having massive success with its Passport service, enough to expand beyond Atlanta, Georgia.

Volvo is also doing well with its Care by Volvo program. However, this success doesn't come without complications, as Automotive News reports that the company now has a waiting list for its subscription service.

Volvo initially opened up its subscription service by offering its compact XC40 SUV for $650 to $850 per month, including insurance and maintenance. Customers sign up for two years and can swap out their vehicle for a new one after just one year. Later, Volvo opened up the service to more models, including the S60 Polestar, which was only available by subscription.

In the first four months of the program, Volvo already sold as many subscriptions as it had expected in the first year. Volvo didn't mention exactly how many people are currently signed up for the program but did confirm that customers who want to subscribe to an XC40 will now be put on a waiting list that stretches into 2019.

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Clearly, Care by Volvo has some issues to work out, but Volvo's subscription service is well-positioned because it only allows customers to swap out their car at the end of the year. Offering multiple swaps during the year adds complication to the service, making it more expensive. Volvo must also figure out how to better integrate its dealers with the service, so cars can be put up for sale when subscribers are done with them after a year.