Ford Dips Toe Into Sharing Economy With New Leasing Program The shared leasing pilot aims to attract customers who don't need a vehicle on a full-time basis, but still want some kind of ownership
This story originally appeared on Fortune Magazine
Ford Motor Co. sees new business opportunities in leasing -- and not in the traditional one customer per one car format. The automaker, which is experimenting with unconventional transportation methods such as car-sharing, will soon start providing group leases for its vehicles.
Beginning next month, Ford will offer leases on vehicles to "self-organized groups of three to six people." The 24-month group leases will only be available at three Austin dealerships -- Covert Ford, Leif Johnson Ford and Maxwell Ford.
The pilot program called Ford Credit Link was announced, alongside several other initiatives, at the North American International Auto Show that began Monday in Detroit. The aim of the initiatives is to find new revenue sources for the company.
Ford accounts for nearly 6 percent of the $2.3 trillion automotive market, CEO Mark Fields told Fortune at CES, the consumer electronics trade show held in Las Vegas earlier this month. However he has his eyes on an even bigger prize: The untapped $5.4 trillion market for car-sharing services that is currently dominated by Zipcar and ride-hailing companies like Uber, which are unrelated to conventional car ownership.
This pilot -- and several more programs that were announced at its Monday press conference -- are part of the company's so-called Ford Smart Mobility plan. The initiative, introduced a year ago at CES, involves building cars with additional Internet connectivity, experimenting with the different forms of transportation as well as experimenting with big data analytics -- like grabbing information from in-vehicle sensors to learn more about how people travel.
The shared leasing pilot aims to attract customers who don't need a vehicle on a full-time basis, but still want some kind of ownership. It's essentially the middle ground between car ownership and car-sharing.
Lease groups will be able to reserve drive time, check vehicle status, keep up with maintenance, communicate with each other, view their account and make payments through a vehicle plug-in device and app, Ford says.
"People already are sharing everything -- from books to homes," said David McClelland, Ford Credit executive vice president of marketing and sales. "We're seeing the potential for a shift from a single consumer paying for a single vehicle to several people sharing costs and benefits."
