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Driving into the Future: The Subscription Wave
VSM's Rise, the Shift from Ownership, and Opportunities Ahead.
Miles Galli
October 24, 2023
GM. Welcome to Highline - Spotting Opportunities in High-Growth Markets.
Podcast Link:https://open.spotify.com/show/2gwZ88PmWkzDW9dC9bosy1
Top Ideas From The Podcast:
Vehicle subscription services is growing at 74.2% Y.o.Y.
Rent Vs Ownership: A New Perspective
The Bullseye for Market Opportunities
High Grow Fragmented Markets = Big Ops for Start-Ups
Rent Your Car Via Your SmartPhone
Vehicle Subscription Market Growth
The VSM Is Growing at 74.3% Y.O.Y until 2032. It is currently estimated to be a size of 3.8B and will grow to 172.4 Bn in 2032. This is the fastest-growing market we have studied on the podcast, and for good reason. Two major trends are driving the market growth, the first being the drive to electric vehicles and net zero, and the second is below:
Rent Vs Ownership: A New Perspective
Ever imagined a world where you don't foot the bill for car servicing, registration, or insurance? The allure of such freedom is undeniable. The idea of being rooted in one place or saddled with hefty financial obligations isn’t appealing to me. And I'm not alone; many Gen-Z and millennials resonate with this sentiment. It's a driving force behind the surge in vehicle subscriptions. Today's generation values flexibility over possession. Watch this trend grow.
🎯The Bullseye Market
The Bullseye market merges rapid growth with societal shifts. The VSM, propelled by the EV trend, stands out. 'Onto,' an electric car subscription brand, exemplifies this perfect positioning in a bullseye market boasting 500% growth in 2021 and a 60m euro raise in 2022.
MiniBit: Spotting Incumbent Missteps
Keep an eye on established companies that venture into new terrains but falter. For instance, in the VHS era, OEMs ventured into car subscription services, only to discreetly wind them down. Their misjudgment in market timing and underestimation of fleet management complexities led to this downfall. It's crucial to note these instances, as these firms often become hesitant about re-entry, fearing past failures and potential embarrassments. This hesitancy is our window of opportunity. It may already be too late for them when they recognise the right market timing.
