It’s been a year since former FMG CEO Mark Chessman joined leading vehicle subscription software company Wagonex as its chair. And what a year it has been, with supply chain issues still impacting the market and the sales of new EVs adversely affecting the value of second-hand EVs – it’s been an interesting time to say the least.

Here the fleet specialist explains what he’s learned during his year at Wagonex, how he sees the future of subscription and the motor market as a whole.

Wagonex chair Mark Chessman

Having enjoyed many years in the fleet and leasing markets, I had an idea of the challenges ahead for Wagonex, but I have also had to learn a lot quickly since joining as chair.

The successful businesses in our industry have always driven growth through innovation. In a rapidly evolving market, I believe, innovation and agility more than ever are key components of success. Many leasing and fleet companies are still using legacy software and IT products that don’t offer the flexibility they need to digitise stock, as well as supplement income and create new revenues streams – that’s where platforms such as Wagonex can help.

Market analysts have found that 8% of all new vehicle registrations will be provided by subscription by 2025, and if disrupted further, the market share for subscription could increase by more than 10%, displacing traditional leasing options, as well as featuring in the used car market as more consumers opt for subscription. It is clear that in the future, subscription will be a key component to car ownership, as more people will look to subscription as a way of trying out new vehicles, supplementing the ones they currently have, or in fact using subscription full time instead of owning a car.

We see many of the big OEMs partnering with us at Wagonex to provide a subscription model, getting themselves ready, for when that tide will turn, with a proposition fit to manage volume. Market participants that are slow to accept the evolution of subscription and don’t prepare for it, are running a risk of putting themselves at a significant disadvantage.

Supply chain issues have rocked our sector in the past few years. However, we can see the green shoots starting to appear – we can see the end in sight – so I believe that now is the time for businesses to join the subscription evolution, get a platform in place ready for when the market returns to some kind of normality that delivers a solid, workable and sustainable solution.

At Wagonex, we know the requirements for dealership groups, leasing and fleet companies and OEMs can be very different and we haven’t tried to fit them all into the same business model. We have tweaked our offering to suit everyone in the market with solutions that allow them to scale quickly and rapidly.

We have developed a platform that will be easy for partners to implement, we will help work out what their holding costs are, what their administration costs are, and what changes they can put in place to come up with compelling subscription offerings for their customers – demonstrating that with a relatively low level of vehicles, businesses can deliver a self-funding subscription pilot. In fact, Wagonex is the only subscription provider in the market that offers prospective partners the option to list stock on Wagonex.com as a way to dip their toe into the sector, before taking the plunge with a full white label option.

I believe this flexibility will encourage more businesses to commit to having subscription as part of their offering, an option that is ready to go and available as a choice for their customers.

Major car manufacturers have already shown their long-term confidence in subscription by developing their own platforms, demonstrating the belief that subscription has a significant part to play in long and short-term vehicle ownership. That commitment is clear to see, so now is the time for others to follow suit.

Wagonex has a platform that’s built for growth and scale and subscription is here to stay.  We are excited about the opportunity we have to support a wide range of market participants position themselves to unlock the opportunities of subscription,

So, I think what I’ve learned more than anything, is that now is the time. There’s a strong sense that a lot of people want to have a subscription capability ready before they have the vehicle stock to push through it, however self-funding pilots can be run with low volumes of vehicles.

Don’t wait until you are at the point of need to get your subscription platform in place – the supply chain is showing signs of recovery and we will soon see a return to normality – so make sure your business is ready for that.

This opportunity is exciting, and it is great to be part of a movement that will not only see growth in the number of consumer customers, but also to be in a position to work with partners and help them scale as the subscription market develops.