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For several years now, a new “ownership” model for vehicles has threatened to disrupt the three traditional incumbents: buying, leasing and renting. Car-as-a-Service (CaaS) has long been touted as the next big thing in the automotive industry, championed at various stages by OEMs, including Porsche and Volvo, rental firms, such as Hertz, and even ride-sharing companies, like Lyft and Uber.
As yet though, Car-as-a-Service is yet to realize its lofty potential. In fact, during the past couple of years, there has been notable fallout, with BMW and Audi ceasing their short-lived CaaS operations.
Many of these bumps in the road can be directly sourced back to the pandemic. Travel restrictions have resulted in fewer drivers on the road; not to mention factory closures and serious problems with the industry’s supply chain.
Despite these setbacks, we and many others in the industry still believe that CaaS has a bright future. Its flexible and commitment-free model appeals to an ever-growing market. And if it is as successful as many forecast, it will cause huge stirs throughout the automotive industry, with almost all players across the value chain being affected. To make the most of those opportunities, it’s important for those players to be ready for what’s coming.