Audi is Purchasing an Upscale Rental Service That Exclusively Uses A4s
Today’s car rental services span the gamut in terms of vehicular offerings and price, but it used to be a more utilitarian affair. Granted, the norm is still to hop online and click the little box next to economy or compact with those full-size sedans reserved for when your employer is footing the bill. However, special discounts or a base Mitsubishi Mirage occasionally make SUVs and even premium cars too tempting to pass up. For those with more discerning tastes, there are entire agencies devoted to specialty cars.
Silvercar is a rental firm that allows customers to charter an Audi A4 similarly to how you would reserve a ZipCar — log in, schedule a pickup, and remotely unlock the vehicle for as long you need access. It’s akin to BMW’s ReachNow, General Motors’ Maven, and Mercedes’ Car2Go — that latter of which is finally replacing its fleet of Smart cars with Benz-branded vehicles. But Audi doesn’t actually own Silvercar, it just happens to be a company providing the exact service that every single automaker wants to include as part of an updated mobility identity. Oh, and it exclusively rents out A4s.
Obviously, Audi is purchasing it.
“Audi and Silvercar share a vision for the future of transportation,” said Matt Carpenter, Audi of America’s chief financial officer, in a corporate announcement. “This acquisition enables Audi to move forward with a progressive partner and continue our technology leadership into the next era of mobility.’’
It’s almost like the Texas-based Silvercar saw what was going in the industry and then designed itself for the sole purpose of being acquired by Audi. If someone wants to become even richer than they already are, copy this business model with Lexus. It doesn’t even need to be a successful company; it just needs to survive long enough to be bought up.
Audi and Silvercar have had a working relationship since 2012, developing and delivering the technology that makes its car-sharing system work. In 2015, Audi even issued a $28 million Series C investment for Silvercar — helping to ripen the fruit before the German carmaker finally decided to pluck it from the vine.
“It’s no secret that Silvercar and Audi have a longstanding relationship,” Silvercar CEO Luke Schneider wrote on the company’s website. “Heck, we’ve only ever rented Audi A4s.”
No deal terms have been announced but, according to Audi, the two companies anticipate the approval of the transaction by responsible regulatory authorities soon “with the transaction concluding in the first half of 2017.”
[Image: Audi]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
More by Matt Posky
Comments
Join the conversation
So does this relegate Audi to "fleet queen" status?
As long as Audi doesn't change their business model or increase prices significantly, this is a great service. All small (midsize) rental cars should be A4's. They are a good driving, classy looking car with a decent amount of space in the cabin and trunk. It's a very functional small car that happens to be an Audi. I would pay a premium to know that I was getting an A4 every time instead of a Chrysler 200 (or similar) that may actually turn out to be a minivan or a Kia Rio, or occasionally a Dodge Durango in Manhattan. It would be interesting to know how much more (or less) an A4 depreciates over its term in the rental lot versus a standard mid-size rental car. I'm sure the cost of acquisition is higher.