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Car subscription services: A slow, expensive start — but the potential is huge

Americans are used to paying for subscriptions — to magazines and cable television, for instance — but experience shows they'll cancel when the price of admission gets too high, or there are more tempting alternatives. Cord cutters ditched nearly 1.5 million pay-TV subscriptions in 2017, according to a survey by Leichtman Research Group. Cable TV started out cheap with basic offerings, and then got expensive. The auto industry's subscription offerings are new, but they're starting out costly, and not price-competitive with traditional leasing. The upside is that they take the hassle out of car ownership for busy people by letting the service take care of maintenance, insurance, licensing and taxes. And they give consumers choice, often allowing relatively painless switches between different cars in the automakers' lineup. Subscription services also point the way toward an ownership-free auto experience, and offer an easy transition to a potential world where ride- and car-sharing will be dominant. Subscriptions are here to stay, but consumers may take a while to "get" them. Lincoln's subscription service for lightly used 2015 to 2017 models, offered through the Ford-owned Canvas beginning this year, got off to a slow start. Many early subscribers canceled. Last month, Cadillac announced it would " temporarily pause" its $1,800-per-month Book subscription service for "adjustments" as of December 1. According to the Wall Street Journal, "Snags with the back-end technology used to support the service made some customer-service functions tedious and time-consuming, adding costs for the company." The challenge for automakers is to come up with a strategy that offers consumers a compelling, affordable option to regular ownership, and one that can also make a profit. I think they'll find that sweet spot, but they're not there yet. Jack Nerad, former executive editorial director at Kelley Blue Book and author of " The Complete Idiot's Guide to Buying or Leasing a Car," points out that "A lot of people expected that subscriptions would be very valuable for people who wanted inexpensive transportation, but the reality is quite the opposite. Subscriptions are offering more choices for the wealthy.

China probing German automakers over spare parts

The Chinese market has proven to be a boon to German luxury automakers. However, the way that the companies have allegedly been controlling their supply of spare parts has begun to draw the ire of the nation's government. According to insiders speaking to Bloomberg, officials from the country's economic planning organization have opened a probe into Audi, BMW, Mercedes-Benz and some Japanese carmakers over claimed price inflation and limiting supply.
Specifically, the investigation centers around two aspects of how the companies do business, according to Bloomberg. Investigators want to know whether the original equipment component makers are able to sell spare parts only to automaker-authorized dealers or if they are also available to independent shops. There is also the issue of whether the price markup on replacement pieces is too high. The tight controls could be partially explained by China's reputation for producing counterfeit parts.
Evidently, the investigators haven't checked parts prices at car dealers elsewhere in the world. At least in the US, paying more at the dealer for factory components just goes along with owning a vehicle. If evidence of price fixing is found, the companies could face fines the equivalent of millions of dollars, according to Bloomberg.

Woman sent to psych ward because police didn't believe she owned a BMW

A woman is suing New York City after she spent eight days in a mental hospital because, she claims, police didn't believe she, a black woman, could own a BMW. Last year, Kamilah Brock was pulled over in Harlem, NY, for having her hands off the wheel, PIX 11 reported. She says she told officers she was dancing while stopped at a red light at the intersection. Police took her into custody and held her for several hours. When Brock was released from the 30th Precinct without any formal charges, police told her she could pick up her car the next day. When she arrived at the impound lot and told officials she was looking for her car - a 2003 BMW 325Cl, she knew there was something wrong as soon as she requested her vehicle. "I just felt like from the moment I said I owned a BMW, I was looked at as a liar," Brock told PIX 11. "They put me in handcuffs and said they just need to put me in handcuffs to take me to my car. And I said OK, whatever it's gonna take to get to my car." Then EMS arrived. She was taken to Harlem Hospital psychiatric ward where she says she was pumped with sedatives and given powerful drugs. Doctors believed she was suffering from bipolar disorder, she claims, and tried for days to get Brock to admit she didn't own the luxury car. They also tried to convince Brock that she wasn't really a banker and President Obama didn't really follow her on Twitter, though both facts are true. The worst part? She was stuck with a $13,000 hospital bill for the pleasure. Brock is currently suing the hospital and several unnamed police officers. Neither the NYPD nor the City's Law Department commented on this story due to ongoing litigation. Government/Legal Weird Car News BMW Ownership Videos lawsuit