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EV manufacturers’ moves towards subscription models ‘will change the automotive industry’ – Whitmore

TESLA’s novel and innovative approach to sales, marketing and loyalty with owners and potential owners has disrupted the automotive industry globally – and virtually – almost from day one.

Ben Whitmore, the chief marketing officer at automotive ‘subscription’ innovator, Brisbane-based eCar Subscription, sees Tesla’s latest leanings into the subscription models – many pioneered by the US tech. sector – driving other auto manufacturers to follow the lead.

“Tesla and BMW’s shift into subscription-based models represents a significant transformation in the automotive industry, as it fundamentally alters the traditional vehicle ownership experience,” Mr Whitmore said. 

“We believe that this trend will likely lead to broader adoption with manufacturers, as it allows them to create ongoing revenue streams, while offering their consumers access to advanced features and services without all the hefty upfront costs.

“However, this approach could create further barriers for Australian consumers, potentially obstructing the adoption of EVs at a time when the market is already facing challenges.

“By pushing for subscriptions, manufacturers risk alienating potential buyers who might feel that they are not getting the full value of their investment, which could cause complications around EV adoption.”

EV resale values in question

Mr Whitmore warned this approach could affect the sell-on value of EVs, “which is already a major barrier for Australian consumers”.

“The shift towards subscription-based models for more advanced features in EVs could significantly impact the resale value of these vehicles,” Mr Whitmore said. “As manufacturers move towards limiting core functionalities to subscription fees, consumers may feel uneasy about purchasing a car that may not retain its full value over time.”

Mr Whitmore said the uncertainty of this market could “easily put off any potential buyers, as they’ll be less inclined to invest in a vehicle that could experience ongoing costs beyond the initial purchase price”.

“This hesitancy can be linked to new Australian data that shows used EVs have below-average resale values and spend longer on the market. This decline in value, particularly when compared with the broader market, raises concerns about EVs as investments, complicating Australia’s transition to EVs.

“Combined with existing worries over resale value, this could hinder broader adoption.”

Broad impact on auto sector

Mr Whitmore said the wider automotive industry will be impacted in many ways, ranging from car subscription services to rideshare and beyond.

“The shift towards subscription-based models in the automotive industry, particularly with manufacturers like Tesla and BMW, could significantly reshape consumer expectations and purchasing behaviours,” he said.

“As basic functionalities become locked behind ‘paywalls’, consumers may feel disillusioned with the initial cost of electric vehicles (EVs), leading to a decline in overall demand.

“This trend could create a ripple effect across the industry, pushing more manufacturers to shift away from traditional ownership. As consumers face rising living costs, they want more flexibility and are increasingly reluctant to commit to long-term financial plans, particularly when vehicle ownership brings risks like depreciation, maintenance, and fluctuating resale value—especially for electric vehicles (EVs).

“In this environment, purchasing a vehicle outright is losing its appeal, making subscription models a more attractive alternative.”

Challenges for rideshare companies

But this shift could also create challenges for rideshare companies, which are often early adopters of EV technology. 

“As the cost of EV subscriptions rises, these companies may pass those expenses on to consumers, leading to higher ride prices and potentially stalling the adoption of EVs in rideshare fleets, where their environmental impact could be significant,” Mr Whitmore said.

“For Australian consumers already cautious about the financial burden of EVs, rising subscription fees could worsen adoption barriers.”

Ben Whitmore is the CMO for both eCar Subscription and owner East Coast Car Rentals, developing flexible and tailored plans to suit individual and business automotive needs.

www.ecarsubscription.com.au

 

 

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Supercars legend Allan Moffat drives focus on dementia at Penrite Oil Sandown 500

DEMENTIA AUSTRALIA was back for a second year in September as the nominated charity for the Penrite Oil Sandown 500, one of the greatly anticipated races returning to the Repco Supercars Championships calendar. 

Supercars, Penrite Racing and Penrite Oil, the major sponsor and partner of the Supercars event, nominated Dementia Australia as their charity partner as a tribute to Dementia Australia patron, Allan Moffat OBE, Supercars Legend, Hall of Fame inductee, and four-time Bathurst 1000 winner who is living with Alzheimer’s disease. 

Dementia Australia CEO, Professor Tanya Buchanan said it was “a privilege to be part of such a significant event in the Repco Supercars Championships calendar”.

“Thank you to Penrite Oil, Penrite Racing, Supercars and most importantly to Allan Moffat and his network of supporters for continuing to give back to the racing community and helping all racegoers to know that if they are impacted by dementia – they are not alone,” Prof. Buchanan said.

“I also thank Steve Grove of Grove Racing who partners with Penrite for his support and generous donation to Dementia Australia in honour of a close family member. The Grove family like so many Australians, has been impacted by dementia.

“Allan Moffat as our Dementia Australia Patron and his support network have been so generous in sharing  his diagnosis and experience of living with Alzheimer’s disease to raise awareness in the community and vital funds for Dementia Australia at fundraising.dementia.org.au/allan-moffat.

“Allan first talked about his diagnosis of Alzheimer’s disease in September 2019 and with his support network he has continued to raise awareness about dementia as a Dementia Australia patron.”

Penrite Oil brfand manager, Jarrod Harding said, “We are so pleased to be working again with Allan Moffat and Dementia Australia.

“It’s a privilege to be able to show our support for Allan, one of my heroes, and for Dementia Australia” Mr Harding said.

“With more than 421,000 Australians estimated to be living with dementia and more than 1.6 million people involved in their care, it’s an important cause for everyone and especially close to our hearts here at Penrite Oil.

“As an Australian family-owned business with strong community values, we feel it's important to give back and support those who need it most.

“As part of the partnership, Penrite Oil will be working with Allan Moffat and his support team to promote Dementia Australia’s work and to encourage community support for the charity’s activities.

“It’s exciting this year as racing enthusiasts at the event [were] treated to seeing a tribute of the 1974 Ford XB Brut 33 Falcon on the 50-year anniversary of Allan’s win at Sandown.”

The three-day race event at the Sandown International Motor Raceway, Melbourne, also prominently featured Dementia Australia’s logo included in the historic livery on Penrite Racing’s Ford Mustangs.  

“Head to dementia.org.au to find out how you can join us to create a future where all people impacted by dementia are supported and welcomed in their communities, no matter where they live,” Mr Harding said.

“I encourage anyone who has concerns about themselves or someone close to them to contact the National Dementia Helpline on 1800 100 500. It’s available for free, 24 hours a day, seven days a week, 365 days a year.”

www.fundraising.dementia.org.au/allan-moffat

www.dementia.org.au

 

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Is the automotive industry the next frontier of the subscription-based economy?

By Ben Whitmore >>

WE’RE LIVING in an era defined by convenience and flexibility, where the subscription-based economy has become known across many sectors, with younger generations already learning to navigate a world where subscriptions are the norm. 

From streaming platforms to software and fitness, we’re seeing a clear shift from ownership to access. 

But one sector that's just beginning to embrace this shift is the automotive industry.

Could it be the next big frontier in the subscription-based economy? I believe the signs suggest a resounding yes.

Subscribing to consumer preferences

In recent years, we’ve witnessed a dramatic change in consumer preferences. The traditional idea of ownership is increasingly giving way to a model that prioritises flexibility and convenience, reflecting a broader trend where experiences and freedom are becoming more valued than long-term commitments.

Subscription services embody this change by offering access to products and services without the burdens of ownership. 

We’ve seen this trend play out across various industries.

In entertainment, platforms like Netflix and Spotify have revolutionised how we consume media, shifting the focus from owning physical media to enjoying an extensive library of content on demand. Software subscriptions have replaced long-lasting licences, offering ongoing updates and flexibility.

Even in fitness, subscription-based gyms and classes are catering to our needs. 

Driving a new service approach

The automotive industry, however, has been slower to adapt. While traditional car ownership remains deeply established, vehicle subscription services are beginning to challenge this norm.

For millennials, Gen Z, and expats, this model presents a compelling alternative that fits their fast-paced and unpredictable lifestyles. 

Vehicle subscriptions offer a level of flexibility and convenience that traditional car ownership simply can’t match. 

For those who frequently relocate or lead temporary lifestyles – like international students, short-term workers, and expats – the subscription model provides a hassle-free solution.

These consumers appreciate the ability to swap vehicles based on their current needs without the long-term commitment and financial burden of ownership. 

Unlike traditional leasing or ownership, vehicle subscriptions allow drivers to switch between different models and types of vehicles with ease. This flexibility mirrors the convenience of streaming new shows or accessing new software features – experiences that modern consumers have come to expect. 

Whether you need a compact car for city driving or a larger SUV for a road trip, a subscription service can meet these needs without the hassle of buying or leasing multiple vehicles.

Save on parking and other costs?

Another bonus of vehicle subscriptions is how much you can save on parking and other costs.

We all know that owning a car often means dealing with the headache of finding (and paying for) parking, especially in crowded cities. But with a subscription, you might get access to shared parking spots or even dodge the whole parking issue altogether, since you can swap vehicles as needed.

Plus, many subscription services bundle maintenance, insurance, and registration into one tidy flat fee, sparing you from those surprise expenses that usually come with owning a car.

It’s a budget-friendly, hassle-free way to enjoy driving without all the usual stress.

The rise of subscription-based services across various industries highlights a significant shift in consumer behaviour. Although the automotive sector is still emerging in this space, it can be assumed to become a major player in the subscription economy.

As more consumers seek flexibility and freedom over ownership, vehicle subscriptions may well become the new norm.

The signs are clear: the automotive industry is on the brink of a subscription revolution, and the future looks bright.

www.ecarsubscription.com.au

 

About the author  

Ben Whitmore is the chief marketing officer (CMO) for both eCar Subscription and East Coast Car Rentals. The eCar Subscription service aims to revolutionise the way consumers view car ownership in a subscription-based society. Developed by East Coast Car Rentals – founded in 1979 – the new eCar Subscription service has been making waves in the Australian automotive market, offering flexible and tailored plans to suit individual needs. It allows consumers to access the latest vehicles without the long-term commitment of ownership. www.ecarsubscription.com.au

 

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Car sharing business is tried and Turo

By Leon Gettler, Talking Business >>

IMAGINE being part of a car sharing business that you can turn into a side-business or hustle.

That’s the promise of Turo, a global car sharing marketplace that offers utes, hybrids, sports cars, vans and electric vehicles (EVs).

Tim Rossanis, Turo Australia's managing director, said guests can book any selection of vehicles on the platform, which is still relatively new to Australia.

“It’s powered by a community of hosts who place their vehicles on the platform to share them and monetizing the assets that would otherwise sit idle in their driveways – sometimes 90 percent of the time – monetizing them and turning them into a small business,” Mr Rossanis told Talking Business.

“They can share their cars and provide a new mobility option for people to get around town.” 

Mr Rossanis said the amount of business hosts would receive from Turo varied from host to host. It depends on how available their cars will be, and how many cars they will have to offer. They also get to set their own price.

“For us, it’s very much about giving people flexibility to run their side-hustle or business in the way they see fit,” Mr Rossanis said.

“Some people treat it as a side hustle, so you will have hosts with one or two cars and they’ll have one booking every couple of days, or a couple of bookings a week, and it’s just a good way of offsetting the cost of car ownership,” he said.

“Then we have what we call business hosts and professional hosts who have more than two, sometimes 10 vehicles in their fleet, renting those cars out on Turo. That’s where it’s a legitimate business where people can be making tens of thousands of dollars.

“In the US, we have hosts who are clearing millions of dollars a year who have significant operations. It’s creating an additional way of monetizing an asset that might otherwise be owned by a big traditional car rental conglomerate and instead shifting the benefit of that asset to the local community.”

Small Aussie car rental operators utilise global network

Mr Rossanis said there were many small car rental operators in Australia who had their own websites and were driving traffic to their pages, using Turo to take advantage of the network effect of a global platform attracting the international travellers coming to Australia.

He said the fact that Turo was built as a community enterprise meant it offered customers more hospitality than car rental companies.

“You might have to go into a shuttle and you (often) wait in line for 20 minutes for your turn and they give you the keys to the car, but it’s not the car you booked. You booked an economy vehicle but they don’t have any left so they gave you a compact vehicle,” Mr Rossanis said.

“That’s very different to the hospitality of Turo where the host, who runs that business, might drop the car at the gate. So as you exit the airport, you have the car pull up. They hand you the keys, check your driver’s licence, take some photos of the car and that’s it,” Mr Rossanis said.

“And the host, they live in the location where you’re travelling. They can give you advice about the destination where you’re travelling (to). It’s just much more hospitable.” 

www.turo.com 

www.leongettler.com

    

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness

https://play.acast.com/s/talkingbusiness/talking-business-7-interview-with-tim-rossanis-from-turo

 

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Proposed new emission standards may hit tradies says HIA

THE Housing Industry Association (HIA) is concerned about the impact the Federal Governments fuel emissions standards will have on the cost of doing business for tradies, according to HIA chief executive for industry and policy, Simon Croft.

“The Federal Government has stated that the new emissions standards won’t increase the costs of utes, 4WDs or other light-commercial vehicles nor restrict access to these types vehicles going forward," Mr Croft said.

“But other industry experts claim to have modelling that shows the new laws will add significant upfront costs and are likely to result in car manufacturers needing to scale back the key types of vehicles that our industry relies on to run and operate their businesses.

“At the moment there is no viable alternative to replace these vehicles," he said. 

“The building industry hasn’t been directly consulted on these new emission standards, despite their potential direct impacts and we would encourage the Federal Government to engage with our industry on the timing and introduction of the proposed new laws.

“Over the past three years, the building industry has faced significant construction price increases, arising from material and labour shortages, as well a range of changes to building, WHS, taxation and business compliance costs.

“Any further added costs, complexities or regulatory impediments being layered over the top of our industry at this time will only make their jobs harder and have downstream impacts on housing supply and affordability," Mr Croft said.

“HIA understands the intent of the proposed emission standards in reducing fuel costs and lowering emissions, however, the uncertainty of new laws and lack of information being released is not helpful.

“Therefore, we would encourage the Government to release their modelling to provide clarity and certainty on the new proposed laws to allow industry to adequately gauge the impact of the laws.

“If the government wants to build 1.2 million houses in five years it needs to consider the needs of the workers who are responsible for reaching that target," Mr Croft said.

www.hia.com.au

 

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Australia’s SEA Electric partners with Zurich to back global commercial EV growth

SEA ELECTRIC, the Australian all-electric commercial vehicle innovator, is collaborating with insurance giant Zurich – through its Zurich Resilience Solutions (ZRS) group – to assist global fleet transitions to sustainable technology.

SEA Electric Australia sales director, Joe Di Santo said the Zurich brand globally represented quality and integrity, with its risk engineering team of around 800 engineers set to work with SEA Electric customers to enhance their EV switch. 

ZRS provides specialised insights and tools – above and beyond insurance – to help companies across a wide range of industries manage traditional and evolving risks to become more resilient. Services are provided across a number of domains, including climate change resilience, supply chain risk, and cyber security.

“The Zurich brand is highly respected within the industry, so to be working in combination with them moving forward has significant positive outcomes for both businesses, and, importantly, SEA Electric customers,” Mr Di Santo said. “The offering Zurich brings to the partnership truly has the potential to complement, enhance and complete the purchase of SEA Electric vehicles.

“Transitioning to electric is a big commitment. Our customers look to and rely on SEA Electric for guidance around the implementation of best practice strategy when it comes to the circular economy of commercial electric vehicles. We take seriously our responsibility of connecting our customers with reputable and proven organisations such as Zurich, as we lead the country in the shift to sustainable transport.

“Zurich’s risk assessment service will assist customers in understanding and identifying the many considerations, both short and long term, that come with such a purchase, ensuring they are properly prepared and set-up to scale as needed,” Mr Di Santo said.

“Ultimately with Zurich, we will be able to share learnings and enhance each other’s product offerings.”

Mr Di Santo said SEA Electric would work to assist Zurich customers in their understanding of commercial electric vehicle operations with customer experience days and webinars, while Zurich’s risk engineering department would benefit from ongoing training from SEA Electric’s knowledgeable team.

For Zurich, the partnership confirms the commitment of the business in working with customers to achieve sustainability.

ZRS Australia and New Zealand chief, Mervyn Rea said, “We are delighted that Zurich’s leading risk and resilience capability is supporting commercial EV uptake in Australia. Zurich and SEA Electric share a common commitment to improving the sustainability and resilience of our customers and community and this agreement presents an important opportunity to further this.”

Available now from a nationwide dealer network, SEA Electric introduced the world’s first comprehensive range of all-electric commercial vehicles in 2021, covering models from 4.5t through to 22.5t, which are entirely adaptable to a wide array of final applications.

www.zurich.com.au/business/services/resilience-solutions.html

www.sea-electric.com/en_au

  

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CarClarity loan platform is on the fast track

By Leon Gettler, Talking Business >>

CARCLARITY, Australia’s first true car loan platform with an easy online application process, is set to revolutionise Australia’s auto market.

Zaheer Jappie, the founder and CEO of CarClarity, said the aim was to change the way people buy and finance car purchases.

He said CarClarity gave people the opportunity to examine options for a new car in 60 seconds. 

“It’s quite a different experience because we take into account the customer’s criteria, their credit score, their income, the car they’re buying and we actually give them real options up front,” Mr Jappie told Talking Business.

He said the process of the car dealership space in Australia and the financing of car purchases had not changed in 20 years.

“What we’re seeing in the other market globally is a big shift to more digital plays for buying a car and financing,” Mr Jappie said. “There’s a lot of hot-off-the-press overseas models that are doing very well and listing for big amounts of money and getting a lot of investment because customers’ needs are obviously more digital now and that’s now moving to the car financing space.”

EXPERIENCE TO CHANGE THE GAME

Mr Jappie himself had been in the consumer financing space for 14 years and had worked for a lender and helped build their distribution channel.

He got involved in car loans and helped distribute it Australia wide for finance brokers and got to understand how the system worked.

“What I realised was there was a huge opportunity here, where there is a disconnect between customer experience and expectations versus the reality of what happens,” Mr Jappie said.

The CarClarity company was set up with a lot of support from executives in the fintech world who have advised the business on its growth.

Mr Jappie said the business had been growing well during the lockdowns as a lot of people were buying cars for family trips “because they could not travel overseas”.

People are also looking for the opportunity to buy and finance and car purchase online, he said. 

Second hand utes, SUVs and four wheel drives have been selling well. People were actually paying more for these than new cars as new models were hard to get, Mr Jappie said.

CUSTOMER FEEDBACK IS CRUCIAL

Mr Jappie said customer feedback was a critical part of the CarClarity business model. The company does 10 customer interviews a month and those interviews provided some important guidance.

“The interesting thing was, when we started this process, we wanted to make it all digital, all online and people want that allowance to do that,” Mr Jappie said.

“They want to be able to do that online. But what a lot of our customers appreciate is actually talking to somebody once they have gone to our site, got their loan.

“They actually want to speak to somebody to help them and get the right advice. The customers’ feedback was they love the digital experience.”

CarClarity is now looking to expand and is talking to manufacturers about how it can work with dealership groups.

Mr Jappie said CarClarity was not looking to be disruptive. It just wanted to make the auto industry more efficient for customers.

“When you have a customer, a dealer and a lender, how can we make that triangle there have a really good harmony between all of them and make a better experience for all involved?” he said.

“That’s definitely the medium-to -ong term goal for us,” Mr Jappie said.

“We want CarClarity to be the home for car finance in Australia.” 

www.carclarity.com.au

www.leongettler.com

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness. 

Hear Talking Business here: https://play.acast.com/s/talkingbusiness/talking-business7-interview-with-zaheer-jappie-from-car-clar

 

 

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