Albany, N.Y., dealer group Keeler Motor Car Co. will debut a subscription program on May 22 to get ahead of the OEMs and captives launching their own pilot programs, Chief Executive Jesse Hord told Auto Finance News.
“We agree with the thesis that over the next five to 10 years there will be a big shift from retail to fleet,” Hord said. “We knew that the OEMs are going to start to experiment with pilots, and we wanted to figure it out for ourselves before they design the programs.” BMW Financial Services and Mercedes-Benz Financial Services both announced subscription pilots in Nashville last month, and Keeler carries both brands alongside Mini and Honda vehicles.
The dealership’s entry-level program, dubbed Drive Keeler, includes insurance, maintenance, and a combined 1,600 miles on as many as three vehicles, for $975 per month. Drive Keeler also has an “Adventure Tier” for $1,495 per month that allows for unlimited vehicle waps and mileage, as well as more luxurious cars. By comparison, Access by BMW costs between $2,000 and $3,000 per month. “Particularly in our market, where it’s very seasonal, [our consumers like] the ability to shift between a truck, a daily commuter, and have that weekend car — the date-night car,” Hord said. “The demand is there, it’s just making the economics work.” Keeler already has 80 people actively using a separate “elite membership” program it launched last year, in which customers can have loaner cars delivered.
Adding a subscription program is “the next jump for us in service levels for the customer,” Hord said. Keeler signed with Clutch Technologies for the subscription software but kept the floorplan financing in-house. “Part of our economic model is being able to finance here and capture the finance income,” he said. “If we get up to the 100- or 200-member level, we’ll do it internally and then we’ll start conversations with our bank — we have a good relationship with KeyBank — about longer-term fleet financing deals.”
