Australia’s first car subscription service Carbar says it expects the share of electric vehicles in its fleet to jump five-fold to around 25 per cent in the next few years after securing a $50 million investment to boost its offering.
Carbar says new facility from Sydney based credit investor Global Credit Investments (GCI) will help fund thousands of new subscriptions, including in EVs as consumers look to both dump the traditional form of car ownership, and move on from traditional drive trains.
The company says around five per cent of its current fleet are EVs, but that’s expected to grow to around 25 per cent, driven primarily by consumer interest and the availability of more electric models.
Co-founder and CEO Des Hang says the company has already struck subscriptions partnerships with sonnen and AGL and more partnerships are expected.
The subscription service includes everything except fuel, or electricity in the case of EVs, and start at around $145 week, although the lowest price EV offering appears to be around $320 a week, for either the Nissan Leaf or the electric MG ZS SUV. A couple of Tesla Model 3s are on offer at $447 a week.
“We can’t forecast exactly how many cars our $50 million debt facility will go towards this kind of car … we expect (the share of EVs) to grow to around 25 per cent in the next few years,” Hang said.
“But depending on the uptake of EVs in Australia even this prediction may be conservative. A recent Carbar customer survey found that roughly one in five expect to sign up to an EV car within the next five years. Car subscriptions will be a key driver of EV adoption in Australia.”
Carbar says it has grown subscribers over 20 times since its last funding round in June, 2019, and continues to solidify itself as the leading car subscription provider in the local market.
“Our success to date has come on the back of timing, customer-centricity and servic,” Hang said.
“We’ve had a huge uptick in demand as a result of the pandemic and increasing consumer interest in EVs. Many Australians are opting for private transport over public transport and that’s translated into a rush of customers for our service.”
The company is also targeting closing a growth equity round in the coming weeks, with new and existing investors responding to fill the round.
“This next round is focused on scaling our operations in our existing markets and expanding to other key Australian cities. We have global ambitions too but are keen to ensure we get the formula right in this market before expanding offshore,” Hang said.
(Updates to clarify current share of EVs in its subscription offering following correction by company).