The trick Ford’s using to stand out from the crowd
Should car brands be bothered about their secondary market? And if so, why?
The business of selling new cars is very different from that of selling used cars. However, it seems that Ford has been taking some serious steps to improve the secondary market value of its brand by acquiring Canvas, the car subscription company, and thereby finding a good channel for its returned cars to generate cash flow.
Canvas is a car subscription platform that provides pre-owned Ford and Lincoln cars for a monthly fee. Ford Motor Credit appears to be using Canvas to manage its stock of used cars. What’s more, the Canvas platform enables Ford to find out which of its customers are early adaptors in the car subscription services market.
For customers, Canvas looks simple and reasonably priced, with a starting price of $379 per month. The Canvas customer journey starts with choosing a car, then deciding on the duration of the subscription and the mileage. The pricing structure is transparent and simple, as you pay a basic price for the car. Subscriptions range from a one-month minimum to a maximum of 12 months; however, the fewer months you subscribe for, the higher the monthly fee, so you get the best deal by signing up for all 12 months.
You can switch cars at any time during the lease period, extend the period and the mileage as you wish, or just terminate the agreement. The choice of cars is reasonably good and includes sedans, hatchbacks, supercrews, SUVs, convertibles, and coupes.
Ford is definitely taking the lead in managing the whole lifecycle of its car production. I believe other car brands are highly likely to follow the same path if they aren’t already doing so.