Flexdrive’s mobile app allows consumers to look up and book vehicles — generally off-lease ones — from dealership inventories for weeks or months at a time with no down payment or long-term contract. Users can swap vehicles at any point, and turn off their subscription for a week if they will be out of town. There are additional mileage fees after the first 300 miles per week, but no mileage limits.
Cox developed Flexdrive’s underlying technology in 2014. It was the first subscription option for Uber drivers, promoted in partnership with Uber. It was piloted at a handful of dealerships in Atlanta and Austin, Texas, and evolved into a joint venture with Holman in early April. Holman wants to take it nationwide, working with other dealership groups.
Flexdrive’s offerings in Atlanta have included a 2013 Ford Fusion for $219 a week, a 2013 Acura TL for $259 a week and a 2013 Toyota Avalon for $279 a week. The pricing includes insurance and maintenance.
Prices of $200-$250 a week are “not too far from what many Americans pay in a buy-here, pay-here deal,” but above the average car payment of $400-$450 a month, said Joe George, senior vice president of Manheim vehicle advantage. A lot of drivers use these cars for Uber or Lyft jobs, he said.
Not requiring a credit check “definitely skews” the membership ranks, George said. Half of the test’s subscribers so far have credit scores below 580, which put them in the subprime category by most measures.
But that could change in a year or six months, said David Liniado, vice president of consumer mobility at Cox Automotive.
For dealerships, the subscription model offers “multiple profit pools,” Liniado said. “The customer is paying in one price for maintenance, service, roadside assistance,” he said.
Flexdrive offers dealerships an outlet for the rising number of off-lease vehicles coming to market. “Demand always outstripped our supply, throughout the pilot,” Liniado said.