Need a car only for the summer? Or maybe you want a 30-day test drive before committing to a purchase.
Or perhaps car ownership, its costs and maintenance, isn’t for you, but you need some personal transportation.
For those reasons and more, some might consider a subscription car service. One is now available in Detroit.
“There’s a section of our demographic that sees mobility as a lifestyle choice and wants to be unburdened from a (car) payment,” said Chance Richie, CEO of Mobiliti in Rochester Hills.
Mobiliti is a national multidealer, multibrand vehicle subscription service app. It is partnering with Tamaroff Auto Group in Southfield to offer a subscription car service starting Sept. 4.
“This really appeals to someone who is here on a temporary assignment where it doesn’t make sense for them to buy a car,” said Richie. “It gives them access to an amazing vehicle for a short period of time and optimal flexibility.”
The vehicle subscription program, which will be called Mobiliti, is like a long-term rental or short-term lease, but without long-term contracts and upfront costs.
The monthly fee, which starts at $599, includes insurance, maintenance and roadside assistance. It gives a customer access to new and luxury vehicle options. There is no cost to join Mobiliti and customers can opt out after one 30-day subscription period, Richie said. The average subscription tenure based on its services in other U.S. cities is three months, he said.
A customer keeps the same vehicle for 30 days, then they can swap it for a different one or stay put, he said. The customer goes to Tamaroff to get the car, which comes with a full tank of gasoline. They return it there either with a full tank or their credit card is charged for refueling it, said Richie.
Eric Frehsee, vice president of Tamaroff Auto Group, predicts robust customer demand for Mobiliti here. That’s because Tamaroff has offered a rental fleet tied to its service and body shop customers for years. Recently, it put that rental fleet online for those who needed a car for a weekend move or a trip Up North, Frehsee said.
“We noticed there was a demand for the cars,” said Frehsee. “So when this opportunity came up with subscription, linking the product to us, we knew there’s a demand. Not everyone wants to purchase a car for five years or lease it for two to three years.”
For example, Frehsee said a doctor from overseas called him recently saying he would be interning at University of Michigan Hospital in Ann Arbor for one year. The man did not want to lease or buy a car for such a short time. So Frehsee told him about Mobiliti. He has also referred Mobiliti to people who’ve told him they have college-age kids who return home for the summer and need a car for only three months.
“If we have a customer looking for, say a Nissan Rogue, but they are unsure about buying it, I would direct them to Mobiliti, let them sign up and do a 30-day test drive of it,” Frehsee said.
Initially, the fleet will have 10 different vehicles, Frehsee said. As demand rises, so will the number and variety of cars available.
Tamaroff sells Nissans and Hondas. But it owns other dealerships and has a vast pool of vehicles it can add to the subscription fleet, some of which will be new and others will be late-model used cars, said Frehsee.
“You’ll see everything available from Nissan small sedans to luxury vehicles such as Infiniti SUVs and sedans” in the fleet, Richie said.
Mobiliti’s monthly fee starts at $599 for small cars, but could go as high as $1,400 for a luxury sedan or SUV, he said. That might sound steep, but Richie said that it’s less expensive than renting a car for a month.
“My insurance rate is about $240 a month in Michigan,” said Richie. “Looking at rentals, we find the monthly rate is double that of $599 when you roll in the insurance cost.”
Mobiliti is designed to have a national footprint so Detroiters who winter in a warmer climate such as Florida can subscribe to it here in the summer months, then use it in the winter when they are in Florida, Richie said.
In June, Mobiliti rolled out in Austin, Texas, partnering with one dealership there. It will add eight more dealerships by the end of September, Richie said. Already it has 300 registered subscribers in Austin.
Southeast Michigan is the fifth U.S. market where Mobiliti is operating its subscription service. Besides Austin, it’s offered in New Jersey, the New York City area and Pennsylvania. In October, it will launch in Florida and Virginia, Richie said.
Richie said it is in talks to offer Mobiliti through other metro-Detroit dealerships soon.
“We’re always looking to expand our dealer networks,” said Richie. “We give all of our dealers geographic exclusivity in terms of the brands they sell.”
Mobiliti in June acquired its only competitor here, a company called Condor Detroit.
But transportation options keep evolving. For example, in July, General Motor’s mobility unit, Maven, said it is testing a peer-to-peer car sharing offering through the Maven app in Detroit, Ann Arbor and Chicago.
The program, called Peer Cars, allows those who own or lease a 2015 model or newer GM vehicle to list their cars on the Maven app for rent to others when the owners aren’t using them. The owner keeps 60 percent of the revenue from renting the car; Maven gets the balance.