Vehicle Lease Subscription Service model launched as a Pilot project in Gurugram and Bengaluru in India.

COVID-19 swept across the globe affecting hundreds of countries and millions of citizens. Apart from the toll on the human population, the economy was hit hard with industries closing down for weeks in India. Post COVID-19, business landscape is vastly different and hence the automobile manufacturing companies are altering their strategy. Maruti Suzuki India Limited (MSIL), India’s largest automaker, has announced the launch of vehicle leasing subscription service, called ‘Maruti Suzuki Subscribe’ for its individual customers. As per the regulatory filing done by Maruti Suzuki, it is rolling out cars for subscription as a pilot scheme in Gurugram and Bengaluru.

“The subscription will be initially available on Swift Dzire, Vitara Brezza and Ertiga from Maruti Suzuki ARENA Channel and Baleno, Ciaz and XL6 from NEXA Channel,” the Maruti Suzuki statement to the media outlets. This move from Maruti Suzuki will be helpful for the customers particularly in the current turbulent economic situation. The COVID-19 led to an economic downturn impacting automobile companies' bottomline as well as the citizens’ financial health. The subscription-based service was in the offing for a year or so with reports of a special projects team of Maruti leading the project.

Maruti Suzuki is collaborating with ORIX Auto Infrastructure Services Limited, a subsidiary of ORIX Corporation, Japan for the subscription-based service. The step to move into subscription service for cars follows Maruti's earlier attempts into vehicle leasing service for corporates didn’t garner much success. 

Maruti Suzuki competitors like Hyundai Motor India Ltd and Mahindra and Mahindra Ltd (M&M) had already entered the lease vehicle space. In 2018, Hyundai made an undisclosed investment in Revv while the Indian automaker Mahindra invested Rs 176 Crores in Zoomcar. The leasing scheme is not a new concept considering premium carmakers like Mercedes-Benz India, Volkswagen India and BMW India have their own customized leasing scheme for the customers. In the current financial climate, automakers are aiming to explore the untapped potential of leasing and subscription services. India’s largest automaker Maruti Suzuki's decision of moving into the car subscription service remains to be seen if it will achieve success or not but it’s a growing sign of the new world post-COVID-19. 

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