Fiat Chrysler to Pilot Car-Sharing, Subscription for Jeep Owners
(Bloomberg) -- Fiat Chrysler Automobiles NV is exploring new ways to boost sales of its money-minting Jeep brand through a three-month pilot with peer-to-peer car-sharing startup Turo and a trial subscription service for Jeep owners.
The automaker is recruiting owners to rent out their vehicles through Turo, which lists 350,000 models on its platform and pitches itself as a a way for motorists to offset their car payments. Fiat Chrysler also is partnering with Avis Budget Group Inc. on a three-month subscription service that will let owners swap their Jeeps for other vehicles, such as a Ram pickup or Dodge Challenger, said Tim Kuniskis, head of the Jeep brand in North America. Both pilots start next week in Boston and will be limited to the first 100 owners who register for each.
“All these people who are casually going, ‘Is it for me or not for me?,’ I can then get them as potential prospects to sell them a brand-new Wrangler,” Kuniskis said in an interview at the Detroit auto show this week. “We’ll find out what’s good and what’s bad, what customers like and what they don’t like, and ultimately from that we’ll decide if we want to do this as something we promote to our dealerships at the time of sale.”
Automakers and car dealers have been dabbling with flexible-ownership models, with mixed success. The goal is attracting younger consumers whose tastes have been shaped by the likes of Airbnb Inc. and Uber Technologies Inc.
General Motors Co. started a program last summer that lets owners rent out their GM vehicles using its car-sharing unit, Maven. GM’s Cadillac brand, BMW AG, Daimler AG’s Mercedes-Benz and Porsche AG all have tried out subscription pilots, though Cadillac paused its program and BMW slashed the initial pricing of its subscriptions after Mercedes offered a lower rate.
The biggest stumbling blocks in figuring out the subscription model are pricing and delivery, Kuniskis said. Avis will supply the inventory for the pilot to spare local dealers the depreciation risk of holding the cars. Participants will be able to flip models as many as six times during the three-month period, two with delivery and the rest requiring them to pick up the vehicle themselves.
“We know all the pluses and minuses of subscription services, we’ve seen some challenges,” Kuniskis said. “Let’s step our toe in, let’s see if this is, No. 1, right for the brand. If it makes sense, let’s try it.”
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