PODCAST | Avis’ plan to conquer car subscription market

The growth of car subscriptions in SA is the focus of this edition of the Business Day Spotlight. 

Our host Mudiwa Gavaza is joined by  Avis Budget Southern Africa COO Tlhabi Ntlha. 

In October, Avis Fleet entered the flexible car rental market with the official launch of iLease, joining the growing consumer shift to subscription as a cheaper option to outright ownership.

While vehicle leasing and rentals have been around for decades, iLease offers flexible leases or rental terms as opposed to fixed ones.

Join the discussion: 

Subscribe: iono.fm | Spotify | Apple Podcasts | Pocket Casts | Player.fm

According to Ntlha, current trends in SA indicate a growing awareness of the financial implications of car ownership, with most consumers not keeping their cars for the entire duration of their agreements.

Avis hopes to take advantage of these trends and the consumer behaviour of millennials, who are more open to new concepts. 

Ntlha outlines Avis’ strategy in car subscriptions and discusses the differences between car rental, subscription and lease services; vehicle ownership trends in SA; and plans for growing the unit over time. 

The group is competing in a growing market that has seen the emergence of other local start-ups such as Naspers-backed Planet42 and FlexClub. 

In essence, these companies use a subscription model to give people access to vehicles. This could be a form of long-term rental as lease periods typically go beyond the short one-day or one-week periods that rental companies such as Avis and Hertz specialise in. Amounts paid for such arrangements also tend to be cheaper than the costs of financing a vehicle. 

Business Day Spotlight is a TimesLIVE Production.