Volvo Speeds Up Subscription Program, Adds Aftersales Support for Life

The Swedish automaker, owned by China’s Geely, aims for faster delivery and insurance approval of subscribed vehicles.

Christie Schweinsberg, Senior Editor

August 26, 2019

5 Min Read
251084_Volvo_MY20_Polestar_Engineered_Trim
Most '20MY Volvos to be available via subscription.

BANFF, ALBERTA, Canada – Volvo continues to tweak its subscription program, Care By Volvo, and announces it now can discern a potential customer’s insurance and credit eligibility instantly.

“On the Care By Volvo app, which is available on iOS and Android, you could subscribe to a car in less than five minutes,” Volvo spokesman Jim Nichols says here last week at a new-model media preview.

This is being accomplished through modifications of the insurance process via partner Liberty Mutual, wherein Volvo will be able to print out an insurance card immediately rather than after 24-to-48 hours. The instant insurance approval already is available in seven states and will roll out to the rest by year-end.

Volvo also is adding vehicles to the program, including CUVs driven here: the ’20 XC60, XC90 and V60 Cross Country. The XC40 CUV and S60 sedan already are offered to subscribers. Care By Volvo is a 2-year program, offering members the opportunity to shift into a new vehicle after one year.

Volvo intends to quicken the pace of delivery, aiming to add stock at dealerships so a person subscribing to a vehicle could pick it up within a day, even if they live in Alaska or Nebraska. Today that only happens if they are near Los Angeles or Newark, NJ, where vehicle stock kept at ports in those cities is sent to dealers for customer delivery.

“We’re working towards a program where you can walk into a retailer and you would be able to subscribe and get that instant delivery, and that’s something we’re certainly looking forward to in the next several months,” says Nichols.

Subscribing to vehicles in the program ranges from $700 to $800 per month, up from a starting price of $600 in 2017. Volvo likes to say everything but gas is factored in, including insurance and maintenance. Care By Volvo is available in all U.S. states save for New York, as the automaker has been unable to get the program approved due to insurance regulations, which vary by state.

The vehicles offered for subscription are top-grade models with interior and exterior colors the only choices a subscriber has to make. Nichols says Volvo discovered leasing and financing customers often are overwhelmed by the multiple ways to configure a vehicle.

“When you compound that with some of the other things, like insurance and tire protection and wear-and-tear, we found that there was a segment of customer that was really interested in just having everything simplified and putting it into one flat monthly rate,” he says, adding he believes this has led to more than 95% of program subscribers being new to Volvo.

So far subscribed vehicles as a percentage of total Volvo sales is small. Compared to those leased or financed, Care By Volvo vehicles make up a single-digit percentage of total Volvo U.S. sales, Nichols says. January-July Volvo U.S. volume was 58,915, up 4.8% from year-ago Wards Intelligence data shows.

The Care By Volvo program has not been without controversy, as the XC40s initially offered were delayed getting into the hands of a number of customers, reportedly due to insurance and legal hang-ups.

California’s Department of Motor Vehicles announced Aug. 21 it would investigate the program, after an auto-dealer trade group appealed to the state’s New Motor Vehicle Board claiming it is a “clever, but illegal marketing ploy,” a 2-year all-inclusive lease in disguise offered by Volvo, thus violating state laws that prohibit competition by manufacturers and dealers. The group also alleges those dealers not participating in the program suffer worse allocation and don’t get in-demand models, Autoblog reports.

Meanwhile, in an effort to make the Volvo ownership experience as easy as possible, and foster loyalty to the brand by customers, Volvo this summer announced several unlimited aftersales programs, including Tow for Life.

“So now, no matter what vintage Volvo you drive, whether you’re talking about a P1800 from the ’60s or a brand-new vehicle, if there is a scenario where it requires a tow for whatever reason, we will offer a free tow to the local (dealership),” Nichols says, adding the brand already has seen vehicles well out of warranty using the program and their local retailer for repairs.

The catch is if someone gets their Volvo towed to the dealership and doesn’t want to have the needed service performed there, they must pay $50 for the cost of the tow. In the case of the oldest Volvos, if a dealer service department has insufficient parts or knowledge of how to make the repair, an owner will not be charged if he or she takes their vehicle elsewhere.

Tow for Life is activated by calling Volvo customer care or pushing the on-call button in newer vehicles.

Volvo also recently launched Accident Advisor in the U.S., which contacts customers involved in minor accidents (once an accident has been detected via vehicle sensors) and walks them through the process of getting their vehicle repaired via an app. The service aims to take the confusion of out what to do in fender benders, while making sure vehicles are repaired to “the standards that we have set for when the car first left the factory,” says Nichols, specifically noting holding safety-system repairs to high standards is crucial.

In a move to keep the business of owners of vintage Volvos, the automaker a few years ago introduced the “Pay Once and Never Again” lifetime warranty. It continues to tweak the program and will warranty the parts and labor for repairs to any older Volvo, so long as they are done in a Volvo facility, for as long as a person owns the vehicle.

None of the three programs depend on where the vehicle was purchased. Nichols notes someone who bought a vintage Volvo on Craigslist would be able to take advantage of Tow for Life immediately, as long as they call Volvo customer care first, not the local Volvo dealer.

For now, Volvo is publicizing these aftersales programs via digital marketing, but that may change in the future with direct marketing to owners of older Volvos via the use of registration data.

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