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The automobile industry has been ever-evolving since its inception. From steam engines to the futuristic self-sustained e-mobility, automobiles have been the ground for backbreaking innovations.
One of the latest fads in the automobile industry is shared ownership. The reduced cost of ownership by sharing the vehicles is fast gaining traction among the new buyers. But, is it really the fad that’s going to change the way the automobile industry operates currently? Let’s find out.
Sharing Is Caring!
The popular proverb from the kindergarten, that probably every American would have recited in their childhood. Perhaps, it holds completely true to the automobile industry. Sharing the ownership of a vehicle can significantly benefit all of the owners. In fact, owners do not need to pay the complete price but only a fraction of it. Moreover, there’s no headache for the owners to maintain the upkeep checks on the vehicle. It is by far the duty of the company that offers shared ownership. Most importantly, it is the environment that can possibly benefit the most. With more shared vehicles on roads, the total number of unnecessary vehicles can witness a significant drop. All the way of allowing the person or the family to enjoy the perks of a safe and secure transportation mode.
Finance Companies Can Experience A Boom
While some may argue the increasing shared ownership can also risk the finance sector, others believe the opposite. To understand this notion, it is necessary to understand how ownership of the vehicle works. In simplest terms, when a prospective driver buys a car, he or she has to make a downpayment, while they cover the rest of the cost through loans from banks and financial institutions. With the introduction of the sharing economy, the loans won’t be needed by the owners anymore. However, this does not eliminate the need for loans completely. As the experts from a reputed auto financing Boise company explain, the companies that offer rides on share seek more loans than an individual can. Moreover, the returns for the financial institutes as well as the owners of the vehicle are equally high.
What About Depreciation?
Another concern for many who are looking forward to the shared mobility is the depreciation of the vehicles. While a usual car owned by a single person would depreciate over 10 to 15 years, the same may take at most 3 to 4 years when shared. In other words, shared vehicles are used more frequently as compared to single ownership vehicles. As a result, the wear and tear of the vehicle is far greater than the other. However, by the time a vehicle is totaled, it would have fetched a handsome return on the investment for owners as well as the company. So, depreciation is at the bottom of all the concerns surrounding the shared mobility industry.
So, does this mean the future is bright for companies offering vehicles for sharing? Well, certainly it is. The growing number of companies stepping into the business, and the financial institutes taking more and more stake in the sector to prove the future promises.
User Inclination Towards The Idea
Most importantly, it is the consumer that shall decide the future of this business and how the automobile industry will turn out to be. So far the sun seems to be shining brighter on the shared mobility. And there are certain prime factors responsible for the shine:
As already mentioned owning a vehicle with others can be very cheap. The owners can subscribe to a monthly package or pay as per their usage. And they can easily customize their package including the choice of vehicle to economize their investment.
Most of the companies that offer vehicles for sharing make use of online portals to connect with their customers. It means there is less or no paperwork.
No/Minimal Cost of Maintenance
For the owners who share their vehicles with others, the cost of the maintenance of the vehicle is borne by the company offering shared mobility services. So, neither the subscriber nor the owner is burdened with the maintenance tasks and costs.
Promising Returns for The Owners
Particularly, for the people who invest their own vehicle or subscribe to a monthly package, the companies offer a dividend on the revenue. It means, there are promising returns for the people who choose to share and own a vehicle.
With so many benefits up front, shared mobility might be the future of the automobile industry. It is only a matter of time and we might witness a huge shift in the economy.