The company, which provides the automotive industry with the software to operate a subscription service model, claims it already supports more than 90 per cent of Australian car subscription providers, including dealerships.
It says it has about 12,000 cars available through its networks – with 6000 of those coming onboard this year. Loopit co-founder and managing director Michael Higgins now predicts that the subscription market in Australia will be worth $1.6 billion by 2026.
Most of Loopit’s revenue comes from established OEMs, car dealerships and emerging car subscription providers which pay a percentage of the value of each recurring subscription placed by customers, plus a fixed fee.
The Loopit platform provides car dealerships, OEMs and emerging car subscription providers with ‘subscription in a box’, including the software, training and services needed to offer car subscription to customers simply and easily.
Adding Loopit to their websites, dealers can select cars from their stock to make available for subscription. Customers can then browse through the website, choose the car they want and subscribe online.
Mr Higgins said alternative car-use models like car subscription “are exploding in popularity around the world, and the industry needs to quickly adapt to cater for the increased demand for these flexible alternatives to car ownership”.
“We are also seeing applications for Loopit’s software in other market segments,” he said.
“This includes large car rental companies, rideshare vehicle providers and other mobility services who are looking to enter the subscription space.”
He said the next big business for mobility is software, not vehicles.
“As car subscription becomes more mainstream, we expect most car dealerships and other stakeholders in the automotive industry to actively participate in the market over the next five years,” he said.
“We expect subscription to become a more prominent option to get behind the wheel of a car alongside traditional forms of ownership like finance and leasing.”
He said the key to building a successful mobility subscription program is in delivering an exceptional customer experience as consumers “will demand the trust and confidence that comes from being aligned with an experienced technology provider”.
“Much like Afterpay transformed the way consumers pay at the checkout with its ‘buy now, pay later’ model, we endeavour to see Loopit build upon its reputation as the trusted name for mobility billing solutions,” he said.
Meanwhile, the company recently announced an initiative to boost electric vehicle adoption by halving its service fee for all existing and new drivers of battery electric vehicles (BEVs) used on subscription, rideshare, rental and fleet across the network.
The initiative opened this month and is planned to run through to December 31, 2021.
Mr Higgins said that Uber rideshare providers, in particular, will be able to take advantage of the savings from both Loopit and Uber.
“By encouraging the adoption of flexible car ownership alternatives like subscription, we are improving access and affordability of electric vehicle technologies,” he said.
“It is our hope that this simple gesture will encourage greater investment into electric vehicle fleets within our provider network.”
Loopit said its recent study showed a link between the uptake of EVs and the proliferation of car subscription with 73 per cent of future EV adopters signalling they would choose subscription as their preferred means of ownership.
“We firmly believe mobility services technology will go hand-in-hand with electric vehicle availability and infrastructure to support the adoption of low-emissions vehicles across the country,” Mr Higgins said.
By Neil Dowling