"After six years Lynk & Co is still a disruptor and nobody is following us"
By pushing a paradigm shift from car ownership to car use, Lynk & Co has already established a name for itself. But surely their subscription model must have experienced growing pains defying the automotive establishment. We talked to CEO Alain Visser to find out and he said: “We’re more a sort of progressive rental company”.
Originally launched in 2016, the Chinese mobility brand embarked on the European market only two years ago as the "automotive Spotify". By monthly subscription and a fee of €500, its members are offered usage of their full-option SUV 01, on which they can, themselves, generate revenue through car-sharing.
The ambitious target of Lynk & Co, with traditional car sales still on offer, was to adopt 70% monthly subscribers.
“Beyond expectations, we are well above 90%”, comments Alain Visser. “I’m happy. You can’t be Spotify and be selling CDs.”
According to Visser, there was no need to adapt the original model along the route. “But suddenly other car manufacturers started using the term subscription also, albeit for nothing more than recycled forms of leasing”, he adds, “which is why we switched to the concept of membership. That’s the only change.”
Future projects
Currently, Lynk & Co can count on almost 60,000 of those members all over Europe. The company is present in four countries through its clubs, with expansion well underway. Covid was a blessing for their new way of car use because isolated crowds of drivers started to rethink their mobility needs and subsequently adapted their strategies.
Though the members, with an average age of around 40 and often city dwellers, can cancel the utilization at any point in time, it rarely happens. “The psychological effect of freedom is at play”, admits Visser. “People just want to know and feel that they can stop the contract anytime. In reality, the levels of return are very low - it’s mostly people moving abroad and that sort of thing.”
The much-coveted monthly fee and car-sharing options are not yet available for corporate circles. The latter is for insurance reasons. “We work on both cases. To serve B2B customers, we have a pan-European deal with leasing company ALD Automotive. We are in the process of setting up a tripartite agreement with Allianz as an insurance partner. By the second quarter of this year also our business clients will be able to take advantage of the car-sharing function.” Visser also confirms that their app services and mobility portfolio will grow in the near future, pointing towards urban micromobility without further specifying a modality.
5% uptime
The case of Lynk & Co is based on the factual intelligence that the average uptime of our worldwide car park is as low as 4-5%. “Therefore, our sharing concept is also of benefit for corporate fleet managers. Utilization rates are even lower at the corporate level, we know that. So why have 20 cars not doing anything in your parking lot, when you can replace them by 12, our sharing app, and cut costs? Well, all too often, buying is still a company policy.”
In these fast-shifting times for car buying, usage, and the appearance of new means of mobility it’s hard to imagine that the competition is reclining in their office chairs. “I am quite marveled, to be honest. Some rental companies, not car manufacturers, show innovative responses. And in a way, Lynk & Co, is a progressive car rental company. But it strikes me that we are still a disruptor after six years and nobody is following.”
Image: Lynk & Co
