The big picture: Volvo's vehicle subscription service has proven so popular that the company can't keep up with demand. It's not the most affordable way to tackle vehicle ownership but that obviously isn't stopping people from signing up. The biggest loser here, however, appears to be traditional car deals as they're missing out on sales and leases that would otherwise involve them.
Volvo at the 2017 LA Auto Show a year ago announced Care by Volvo, a subscription model that offers a new take on traditional vehicle ownership. For $650 per month, you get a new Volvo XC40 crossover, 24/7 concierge service, tire and wheel road hazard protection, 15,000-mile annual allowance, factory scheduled maintenance (including wear items like wipers and brakes) at no charge, insurance through Liberty Mutual and $1,000 in excess wear and use protection when you turn the car back in.
Subscribers must sign a 24-month agreement but have the option to upgrade to a new model after just 12 months.
Basically, all you pay for is fuel.
The subscription service has turned out to be a huge hit for Volvo. According to a recent report from Automotive News, Volvo sold the number of subscriptions it anticipated for the first full year in just four months. As a result, there is now a wait list for the XC40 that extends into 2019.
Other vehicles are also part of the program although pricing varies.
BMW launched a similar subscription service earlier this year starting at $2,000 per month. Cadillac recently ended its subscription service, Book by Cadillac, due to a lack of interest. Perhaps its $1,800 per month price point had something to do with it.