Subscribing to an Electric Vehicle Future
Nov. 10, 2022—The market for electric vehicle customers is growing. This can be seen by simply hitting the freeway, or even just driving around a town. There are more electric vehicles on the roads these days and that isn’t going away anytime soon. Naturally, this means there will be more EV customers to come.
There are a variety of ways to appeal to these customers, and a company named Autonomy is taking a subscription-based approach. Georg Bauer is the president and vice chairman of Autonomy, and he sees this business model as an effective solution for EV customers.
“Don’t you subscribe to everything that’s attractive and interesting in life? Whether it’s movies or music or other things, it’s on subscription,” Bauer says. “Society moves from ownership to usership.”
Autonomy launched in February 2022 and allows customers to get into an EV without having to purchase a vehicle. Bauer explains customers can download the app, scan their driver's license, link their form of payment, sign a digital contract and schedule a delivery time. It’s a paperless process that customers can complete on their phone, and Bauer says Autonomy is proud of this innovative approach.
“It’s a time for entrepreneurs [and] for forward-thinking organizations that put the customer first [and] put technology to work for a great customer experience, and we believe that at Autonomy that’s exactly what we are doing,” Bauer says.
Autonomy owns the EVs, and Bauer says this means the company takes on components of traditional vehicle ownership so that Autonomy’s customers do not have to. Autonomy also partners with OEMs for warranties and with retailer AutoNation on a nationwide scale. Bauer sees partnerships in general as part of the overall EV transitional approach.
“Old and new are partnering, small and large are going to partner … [the beneficiary] will be the consumer, we think that’s well deserved and it’s about time,” Bauer says.
Through a monthly payment model, Autonomy customers get access to the EV itself as well as roadside assistance. Autonomy takes care of the title, routine maintenance, sourcing and registration. Bauer explains that this approach allows more flexibility to the customer, including those they may not want to make a long-term commitment to an EV right away.
“The single biggest hurdle in electric vehicle adoption is affordability, but it’s not the only one,” Bauer says.
Bauer notes that with EV purchase prices averaging as more expensive than their ICE counterparts, there is a bit of challenge for some people in making that transition. He also cites product availability as another component in this conversation, keeping chip shortages in mind. Bauer foresees the potential for greater demand than supply for electric vehicles looking into the future.
Bauer sees subscriptions as an avenue for addressing uncertainty and affordability with customers by using a recurring revenue model.
“We have the opportunity of pricing a subscription at the level of a comparable lease or a comparable 3-to-4-year loan,” Bauer says.
Another component of the conversation surrounding EVs is range anxiety. Electric vehicle drivers may have some hesitance with driving these vehicles if they are not certain where they can get their next charge, or if they don’t feel confident in their vehicle’s ability to last on a given charge. Bauer acknowledges this thought and says that the compounding factors of range anxiety are approachable.
Bauer says that adequate preparation ahead of time, especially for longer trips, is possible using apps that help a driver determine where charging stations are available. In terms of an everyday commute, Bauer notes that plenty of EV charging takes place at home.
“They’re charging … on a daily basis. Eighty percent of it happens at home at Level 1, 110-volt charging outlets,” Bauer says. “And again, in light of [a] 25-mile average commute, all of this is manageable.”
Bauer says that charging infrastructure will be required to improve moving forward, but statistics have already shown that increased availability is possible.
“Let’s just take a look at the statistics comparing 2020 and 2022 Q2 numbers [for] charging stations in the U.S., [an] increase from 33,000 to 54,000 within a two-year period,” Bauer says. “So that is already quite a rapid pace.”
Overall, Bauer says that there is opportunity to be found in the EV future if players in the industry are willing to embrace it.
“EVs have higher repair costs and need longer repair times. There will be a lot of training [and] a lot of adjustment along the way,” Bauer says. “But higher repair costs lower repair times than internal combustion engine vehicles means that there is more revenue to be generated.”
Bauer says that adjustments and adaptations will be required, but he is confident that there will be space in the industry for EV repair. Across the industry, Bauer says that this adaptability will be necessary. He says it’s a race that revolves around the customer and technology.
“It’s a mindset topic where players in the space, whether small, mid-sized or large, are going to succeed if they have agility, the flexibility and the speed [to respond] to the situation [and respond] to experiences that they make, and make the necessary adjustments along the way,” Bauer says.
Essentially, there are many factors at play when it comes to the EV future, and the entire automotive industry is impacted by all the challenges and opportunities that arise along the way.
“This entire transformation has so many bits and pieces … along the entire automotive value chain,” Bauer says. “But what is so exciting is that everything is up for being redefined and I believe the planet will benefit from it … and the consumer.”
The Autonomy model is a customer-focused approach that tackles EV usership in a new way. As with many aspects of new and emerging vehicle technology, there are unknowns. But just because the road isn’t paved yet, that doesn’t mean it’s not worth exploring.
“There is no road map for anything because we have never experienced what we’re going through in automotive now,” Bauer says.
Hear more from Bauer by listening to his full interview on the ADAPT Podcast.