Chris Noone

HYUNDAI dealers will have an additional income stream and get exposure to a broader audience of customers after Hyundai Motor Company Australia (HMCA) in recent weeks became the first OEM to sign up to a subscription service run by Australian innovator Carly.

It is the third dealer-related announcement from Carly, part of listed company Collaborate Corporation, but the first with an OEM.

Carly CEO Chris Noone told GoAutoNews Premium that HMCA – and its 172 dealer network – will not be the only OEM to partner with the subscription service group.

“We are approaching this via the OEMs and obviously they’ll be pushing their own models but when we go through the dealers, those dealers are finding that a number of car brands are suitable for this proposition,” he said.

“We have an open approach because at the end of the day, we want to move as many cars as possible and we know there is demand for many different types of vehicles so we want to be in a position to provide as many vehicles as possible.”

Mr Noone said Carly was in discussions with other OEMs “and we will announce these as they come up”.

The relationship with Hyundai will start within a few weeks as Carly and Hyundai jointly make presentations to Hyundai dealers around the country.

Mr Noone said Carly is creating a “mini-site” for HMCA which is purely for Hyundai dealers.

Marketing will drive customers to that site and then the customers will be able to subscribe to those individual vehicles.

“It is not launched yet. We haven’t announced a launch date but it’s relatively soon,” he said.

Mr Noone said he has had discussions with other OEMs and dealer groups.

Hyundai i30

“Hyundai was the first one that we spoke to and the ones that we engaged with quite quickly and worked up the joint proposition with them,” he said.

“They were certainly ready to innovate and they were certainly looking for different ways to engage their customers with them.

“When we spoke to them it was the right timing because they were open to these conversations and were looking for different ways to offer their vehicles to customers.”

Mr Noone said when talking to HMCA representatives, including CEO JW Lee, regarding the deal, it was clear that Carly could provide a lot positives from sales through to marketing.

“The main point is that it will generate revenue for the dealers,” he said. “Hyundai said it absolutely wanted it to engage their dealers and provide benefits to them.

“Carly also is a customer experience and a marketing opportunity, so it wraps a few different things in together and that’s where we have gone beyond what others have done previously because it engages the dealer network and that’s a new step.”

In a statement, Mr Lee said: “We’re excited to be partnering with Carly to launch an industry first vehicle subscription program delivered through the Hyundai dealer network.

“The future of personal mobility will not be based solely around vehicle ownership and Hyundai will adapt to changing consumer demands.

Hyundai Kona

“Through this partnership we will provide consumers with more choice and an alternative to purchasing a vehicle which for some drivers may better suit their ever-evolving lifestyles.”

Mr Noone said that one of the biggest advantages of Carly was its ability to secure the customer online.

“One of the biggest challenges we see with retailing at the moment is that dealers spend a lot of time engaging people through websites and through classified and other digital channels,” he said.

“The challenge is getting these people off their mobile phone or computer and to walk into a dealership.

“The beauty is that Carly’s subscription service can be done entirely online. So the only time the customer has to walk into the dealership is to pick up the car.

“They have already organised the subscription, they have paid, we have done the ID verification, all online.

“So this is a way of bringing in new business to the dealers not necessarily trying to substitute the retail channel that they already have. This is offering a new acquisition channel but also a new way to engage customers.”

While the focus for Hyundai will be to attract new customers to its new vehicles, Carly can also be applied by dealers to used-car stock.

A Carly subscription is a minimum of 30 days and then has a monthly recurring subscription and then a 30-day termination period. Customers can change vehicles through that period.

Carly said the average subscription period is now “many months”.

The price the customer pays each month is inclusive of the car, insurance, registration, CTP and the servicing of the vehicle.

Carly team

At the end of the period the car stays with the dealer and remains a subscription proposition or, because the vehicle is owned by the dealer, can be taken out of the subscription net and placed on the dealer’s used-car lot.

Carly also has two dealer groups, Suttons Motors Kia and Nissan and the Turners Automotive Group in New Zealand, signed up to use its service.

“Our program with Suttons is almost the same as the one we have with Hyundai,” Mr Noone said.

“The Turners arrangement is not launched yet. Turners will actually be launching Carly on our behalf in New Zealand. It’s quite different because they’ll be running the program in New Zealand.

“In Australia, Hyundai and Suttons are supplying vehicles to us.”

Mr Noone said some other subscription service businesses had also announced a relationship with an OEM.

“As far as we can tell, all they have done is sold cars to a subscription provider,” he said.

“We don’t see that that is engaging in subscription. It’s just like saying that a car brand has sold some cars to a rental company like Avis.

“We have fully engaged Hyundai and its dealers in the subscription program, not just buying some cars from them and saying we are doing subscription. That’s why this is an industry first.”

Meanwhile, Mr Noone said that Carly’s sister company, DriveMyCar, was getting busy for the Christmas period which is the company’s peak demand time for rental cars.

“We are ramping up for that and bringing in extra cars and we are working in the Uber channel renting cars to Uber drivers,” he said.

“We have noticed an uplift in interest with Uber because it has recently announced the five-star ANCAP requirement for vehicles.

“There are a number of people wanting to come onto the Uber platform who are finding their older vehicles are no longer compliant.

“These people are now coming through DriveMyCar and renting a car that is compliant. So we are seeing a good uplift in business from that,” he said.

By Neil Dowling