FCA Jumps into Subscription Market With Jeep, Mercedes-Benz Reveals Pricing | Auto Finance News | Auto Finance News

FCA Jumps into Subscription Market With Jeep, Mercedes-Benz Reveals Pricing

2019 Jeep Cherokee Overland

On the heels of announcing plans to form its own U.S. captive, Fiat Chrysler Automobiles will launch a subscription program called Jeep Wave — a membership program offering drivers the ability to switch between vehicles for a single monthly fee.

Making its debut in 2019, Jeep’s program will offer vehicles in “good, better, and best” tiers, including different options for insurance coverage. However, Jeep has not released details about the cost of subscriptions, what’s included, or the full list of vehicles to be offered.

Earlier this month, the OEM signaled plans to double Jeep sales by 2022 and this program could certainly assist with that goal. However, it’s unclear who would finance the program, calculate the risk, and run residual values for such a program as FCA is in the midst of discussions to purchase the Chrysler Capital book of loans from Santander Consumer USA. Should that deal not go through FCA would have to build a program from the ground up.

FCA joins other manufacturers that recently announced or launched subscription services this year such as BMW Financial Services, Hyundai Motor Finance, Toyota Financial Services’ forthcoming Lexus program, and Mercedes-Benz Financial Services.

This week, Mercedes-Benz released pricing details of its subscription service, Mercedes-Benz Collection. The program is priced at $1,095 to $2,995 per month with members paying a one-time activation fee of $495. The service will be tested in Nashville, Tenn. and Philadelphia.

With the subscription market growing rapidly and consumer appetite changing when it comes to obtaining vehicles, “financial and mobility services are evolving to fit those demands,” Geoff Robinson, vice president of Mercedes-Benz Financial Services unit, said in a press release.

Similar to Jeep’s plans, there are three tiers — “signature, reserve, and premier.” Subscribers can access any type of vehicle within their tier with no mileage limitations. The monthly subscription fee for the tier also includes insurance, 24/7 roadside assistance, and vehicle maintenance.

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