3 Reasons why car subscriptions are on the rise

3 Reasons why car subscriptions are on the rise

It’s no secret that Australians love their cars. In January 2021, there were 20.1 million registered motor vehicles in Australia — an increase of 1.7% from 2020. But with inflation currently at 6% and interest rates expected to be at 3% by the end of 2022, the increased cost of living pressures has caused a lot of us to rethink our more expensive purchases.

Meanwhile, growth in subscriptions and on-demand services has exploded, creating the perfect opportunity for car subscription services to enter the scene. In this blog, we asked one of the founders of a car subscription service what are the 3 reasons why subscriptions are on the rise in Australia, and whether this trend marks a change in the way we use private cars in the future.

Greater Flexibility

Car subscription services are offering users the flexibility to try new cars, hire for specific timeframes, rent-to-own, return or even swap vehicles that they don’t like. In particular, as Electric Cars become more popular in Australia, but remain fairly pricy and range-anxiety-inducing, many are turning to subscriptions or short-term rentals to ‘try before they buy’.

“Moving into the car subscription space, it's a different problem that we're trying to solve, which is really offering more flexible alternatives to traditional car ownership. Says Paul Higgins, Co-founder of car subscription service, HelloCars. “We're seeing a move towards usership rather than ownership… It's not appealing for a lot of people to go into a car dealership and look around and haggle.”

Reduce costs

Like most ride-share or subscription services, one of the biggest draws is cost — renting a vehicle or using a ride-share allows people to avoid the traditional costs associated with owning a vehicle: rego, insurance, maintenance costs, servicing costs, and inclusive road-side assistance.

Recent supply chain issues have caused a global shortage of cars, with both the cost and wait times for new vehicles blowing out dramatically. In some instances, second-hand cars are now equally as expensive as purchasing a new one.

“More broadly, I think that consumer habits have changed.” says Paul, “people are looking for online, personalized experiences, they're not wanting to necessarily go into a dealership and haggle with someone to buy a car, they want something that suits their lifestyle.”


One of the driving trends behind the growth of subscription car services is sustainability. Having access to a shared vehicle reduces the need for people to purchase their own and use cars already on the market, with the potential to slow the growth in private car purchases.

“Australia has very high ownership of vehicles.” says Paul, “I can only see that trend going in one direction. Alternatives to car ownership, like subscription, like rideshare, are really going to drive that change.”

Learn more trends in car subscriptions and vehicle ownership by listening to our Byte Size podcast episode, featuring HelloCars Co-founder, Paul Higgins.

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