RIO DE JANEIRO, BRAZIL – Engaging in a trend started by automakers such as Toyota, Audi, Volkswagen, Fiat and Jeep, in Brazil, Renault has just joined the subscription car business. Named Renault On Demand, the service pledges to be the cheapest in the country today.
Vehicle subscription is a service where a customer pays a recurring fee for the right to use one or more automotive vehicles. Some vehicle subscriptions offer insurance and maintenance as part of the subscription fee; other subscriptions allow the subscriber to switch between different vehicles during their subscription period. Industry commentators consider vehicle subscription to be an alternative to owning or leasing a vehicle.
“After the pandemic, many people have returned to assess the purchase of a car and we believe that demand for this business model will be high,” said Bruno Hohmann, commercial vice-president of Renault Brazil.
The service will be offered to both individuals and companies. Like similar services recently launched in the market, Renault’s subscription car contract includes insurance, document management, 24 hour national assistance (including car reservation) and scheduled servicing.
Late last year, Volkswagen launched the service promising “competitive prices”. Shortly after, Fiat and Jeep also made their launch, highlighting the concept of mobility the way clients choose. Caoa also joined the segment and the trend is for this business model to grow in the country.
The car models offered by Renault will initially be two versions of the Kwid, the Sandero Stepway and the SUV Duster. According to Hohmann, the aim is to expand this range in the future, including an electric car.
The contracts, which can be for 12, 18 or 24 month periods, cost from R$869 per month. There is a monthly mileage limit, but if exceeded, 50 cents per additional kilometer will be charged. However, Renault will advise clients in case they have greatly exceeded the limit, so that they will not have a negative surprise at the end of the month.
Signature contract prices:
Kwid Zen 1.0 – from R$869 per month
Kwid Outsider 1.0 – starting at R$979 per month
Iconic 1.6 automatic Stepway Sandero – from R$1,530 per month
Automatic 1.6 Duster – starting at R$1,699 per month
The assembler points out that the service is hired fully online and takes approximately ten minutes to be completed. “The client wants comfort and a good product”, says Hohmann.
A Kwid client, for instance, does not want to spend as much to pay the deposit of a new model and wants planning for financial security.
The assembler has no signatures goal, but Hohmann assures that this service will grow strongly in Brazil, as it already occurs in other countries. He mentions France as an example, where the brand is headquartered. There, the executive says that 25% of new car sales are now through the signature model.
“If currently people are consuming everything by order, why should it be different with cars?”, says the executive.