The Psychology of Car Ownership vs. Subscription: Why It Matters

The automotive industry is currently witnessing a monumental shift in consumer behaviour and preferences, as many drivers are moving towards subscription based models over traditional ownership.

These changes reflect both evolving market dynamics and intricate psychological factors that influence driving consumer decision-making. So what is causing more and more drivers to shift to rental and subscription?

This article will explore the various psychological factors at play in the shift towards alternative approaches to accessing vehicle ownership. Enterprises like We Rent Cars are at the forefront of this transformative shift, by offering innovative rent-to-buy car subscriptions that provide consumers with flexible and affordable options to drivers, especially in South Africa. 

The Appeal of Regular Car Ownership 

Car ownership has always held an important place in modern societies, embodying notions of freedom, status, and personal identity. Several of these psychological factors contribute to the enduring appeal of owning your own vehicle. 

Autonomy and Control 

Owning a vehicle provides consumers with a sense of complete autonomy and control over one’s own transportation and movement around a region. With ownership comes the freedom to travel on one’s own schedule, explore new destinations, and gain a feeling of independence.

Status Symbol 

For many, owning and driving a vehicle means much more than simply being able to get from point A to point B. Vehicles also represent a symbol of status and achievement. The type of car that one drives often seems to reflect their economic standing which influences how others see them. 

This social signalling aspect of car ownership is a significant psychological factor that contributes to the appeal, especially in Western countries where material possessions are closely linked to status. 

Emotional Attachment 

When speaking on the psychology of asset ownership, the attachment that many individuals develop when it comes to their cars often represents an extension of themselves. This emotional bond can stem from shared experiences, memorable journeys, or simply the satisfaction that arises when owning a prized possession.

Despite these deeply ingrained psychological factors, the landscape of car ownership is still undergoing a profound transformation… 

The Rise of Subscription Based Models 

Over the past few years, subscription-based models have gained a tremendous amount of traction across various industries. The automotive sector is no exception with subscription-based car services offering an alternative to traditional ownership: 

Convenience and Flexibility 

One of the primary psychological appeals of subscription based models is the convenience and flexibility they offer. Instead of committing to something like a long-term leases, subscribers can access vehicles on a short-term basis, often with the option to switch models or upgrade as their needs change. 

Affordability 

Subscription-based models often provide a more affordable alternative to traditional ownership, particularly for individuals who may not have the upfront capital or creditworthiness to purchase a vehicle outright. By spreading the cost over monthly payments, consumers can access high-quality vehicles without a large down payment or loan. 

Simplified Experience

Subscription services streamline the car ownership experience, eliminating the hassles associated with maintenance, insurance, and depreciation. At We Rent Cars, for example, you receive the following benefits when entering into a rent-to-buy subscription:

• A tracking device

• Yearly licence renewal

• 24h roadside assistance

• Comprehensive insurance

• Minor services every 10 000 km for 54 months.

Psychological Factors in Consumer Decision Making 

The decision making process when it comes to financing a vehicle is influenced by a myriad of psychological factors in addition to all of the aspects mentioned above. These factors and aspects work to shape individual consumers’ perceptions and purchasing preferences. 

Loss Aversion 

Loss aversion is a cognitive bias that describes the tendency for individuals to prefer avoiding losses over acquiring equivalent gains. 

When considering car ownership versus subscription services, individuals may perceive ownership as a safeguard against the loss of investment, viewing it as a more secure option than subscribing to a service where they do not retain ownership rights. 

Present Bias 

Present bias refers to the tendency for individuals to prioritise immediate rewards over long-term benefits. Subscription services make short term losses much smaller and immediate and long term benefits far greater. 

For example, subscription-based services provide unparalleled flexibility and adaptability, allowing individuals to tailor their transportation solutions to suit their evolving needs and lifestyles. 

Unlike traditional ownership, which requires a long-term commitment to a single vehicle, subscription services offer the freedom to switch between models, upgrade as desired, or adjust usage patterns based on changing circumstances.

At the end of a rent-to-buy subscription you also get the opportunity to gain full ownership of the vehicle. 

Social Comparison 

Social comparison is the process of evaluating oneself in relation to others, often leading to feelings of superiority or inferiority. In the context of car ownership versus subscription services, individuals may base their decisions on how their choices reflect their social status. 

With a car subscription service, you can gain access to high-quality vehicles that elevate your perceived social status and success, at a fraction of the cost. Being able to drive a car that makes you feel good as a massive psychological point in favour of subscription based models. 

Experience Psychological Benefits with We Rent Cars

As the landscape of transportation evolves, the psychological benefits of subscription-based models over traditional car ownership become increasingly apparent.

We Rent Cars is at the forefront of this transformative shift, dedicated to providing accessible and affordable rent-to-buy car subscriptions to everyone in South Africa.

Contact an agent today!