The UAE's car-sharing platform ekar is offering a car subscription leasing service across Saudi Arabia in partnership with some of the biggest vehicle rental companies in the kingdom.
Subscription cars are delivered to the customer's door and they come with insurance, maintenance and roadside assistance. The cars can be switched, traded up or returned at any time.
The service offers an alternative to buying, leasing or renting a car for customers who want to have a personal vehicle without the cost or commitment of ownership, the company said on Monday.
"Ekar Saudi Arabia car-sharing experienced a spike in demand for longer-term bookings during the pandemic, especially with female drivers who choose ekar as their ‘first car solution'," said Vilhelm Hedberg, founder of the company.
"Launching subscription leasing is a perfect solution for our 100,000 users in the kingdom.
"The marketplace is nascent in Saudi Arabia, and the combination of subscription leasing with car-sharing will make ekar the only app in the market that offers the entire vertical of self-drive from per minute car-sharing to multiple months subscriptions."
The subscription leasing option, available through ekar's mobile app, will be introduced in Riyadh, Dammam, Jeddah, Mekkah, Taif, Abha, and Jaizan in its first phase.
Car-sharing apps that allow customers to rent a vehicle by the hour, or even minute, have been growing in popularity. The pay-per-use model saves drivers on insurance, maintenance costs and loan repayments.
More consumers are now open to vehicle subscription services, a survey of car industry executives conducted by management consultancy McKinsey found last year.
In 2016, Mr Hedberg decided to fill the gap in the market in the Middle East by launching ekar, which is now the biggest car-sharing platform in the region, said the company.
The UAE start-up provides a network of vehicles that can be booked and unlocked through its mobile app. The service is used by more than 250,000 customers who booked 1.6 million trips since the company's inception five years ago.
After introducing subscription leasing in the UAE in early 2021, the company is now poised to bring this service to Saudi Arabia where the car rental and leasing market is expected to grow to $2.5 billion by 2026, India-based consultancy Mordor Intelligence said.
Ekar is planning to expand into the global automotive subscription services market, with plans to launch in Malaysia, Turkey and Egypt over the next 12 months. Earlier this month, ekar said it will begin operations in Bangkok in January 2022, a move that will mark its expansion in South-East Asia.
