Mercedes-Benz may be late launching its vehicle subscription service, but it's making up for it with a shocker of a sticker price. Starting at $1,095 per month, Mercedes undercuts by half similar programs from BMW and Porsche.
Mercedes' program, the Mercedes-Benz Collection, gives subscribers access to 30 model variants for a monthly fee, which includes insurance, 24/7 roadside assistance and vehicle maintenance.
The subscription program allows "our customers to drive different vehicles for different occasions," Mercedes-Benz USA CEO Dietmar Exler told Automotive News. "It provides the luxury of having the right car at the right time."
Automakers are experimenting with subscription programs in a nod to changing realities. Rapid technological advancement, coupled with the emergence of affordable and abundant ride-hailing services, has pressured the traditional car-ownership model.
Instead of forcing consumers to buy one vehicle for every driving need, subscription programs let customers select vehicles for specific occasions — an SUV when extended family is in town, a convertible for a weekend getaway or a compact for the downtown commute.
Mercedes-Benz USA and the brand's financial arm, Mercedes-Benz Financial Services USA, jointly launched the two-year pilot in Nashville and Philadelphia.
Mercedes' subscription program has three tiers — Signature, Reserve and Premier — with prices ranging from $1,095 to $2,995 a month. In comparison, BMW's program — which has also picked Nashville for a pilot — ranges from $2,000 to $3,700 a month, while Porsche's service ranges from $2,000 to $3,000 a month. Cadillac's single-tier program costs $1,800 a month.
Mercedes' subscription program is priced to drive adoption and "attract people to the brand," said Akshay Anand, executive analyst for Kelley Blue Book.
"It's about accessibility," Anand said. "As we see more and more subscription plans released, you're going to see lower and lower price points."