Deal or No Deal: Volvo XC40 Subscription Service Starts at $600 Per Month

Matt Posky
by Matt Posky

Volvo Cars is rolling out a subscription service that allows access to vehicles for a monthly fee. It’s a growing trend among luxury brands. Book by Cadillac is the first service to spring to mind but brands like Porsche and Ford have introduced regional pilot programs offering roughly the same thing. Volvo’s subscription service is not a trial run, however. It’s the full enchilada.

For $600 a month, Care by Volvo is offering access to its new XC40 — the new compact SUV that just started production in Belgium this month. Here’s how it works: Volvo customers choose a car online and make a monthly payment that covers insurance, service, and maintenance. The subscription last 24 months but, during that time, customers will be given the opportunity to change cars and sign up for a new 24-month subscription as early as a year into the existing agreement.

It’s an interesting alternative to leasing and a lot of outlets have praised the service for being so affordable, especially compared to Cadillac’s monthly subscription fee of $1,500. But the services aren’t directly comparable. Fist of all, General Motors allows customers to swap vehicles month to month. Secondly, those models are valeted to you and could have an MSRP in excess of $86,000.

Meanwhile, Volvo’s XC40 starts around $33,200. However, the subscription-service model is the T5 AWD Momentum trim that comes with 2.0-liter turbo engine, 19-inch black diamond-cut wheels, heated front seats, heated steering wheel, and a panoramic roof. That unit costs two-grand more out the door than the base XC40.

Customers can also pay a $700 monthly fee and upgrade to the T5 R-Design, which comes with everything that the standard model has — plus a Harmon Kardon audio system, different color scheme, and larger wheels.

However, the million-dollar question is if this subscription service is really worth it. While Forbes seemed keen on the pricing strategy, we’re of the mind that it being a bargain is highly circumstantial. It’s not much different than what it would cost to purchase an XC40 using a 60-month loan and some pretty average financing. That said, if you’ve got horrendous credit and are likely to be slammed with high interest rates, then $600 a month might not be such a bad deal.

Of course, if you’re buying you have to insure the car yourself but you also get to sell it once you’ve paid it off. Although, if you’re interested in a subscription service in the first place, you’re probably more apt to lease than buy — and leasing is where Care by Volvo runs into the most trouble.

You can lease a similarly priced Volvo for significantly less than $600 per month and the same is true of far more expensive models. The dealership nearest to me is currently offering the 2018 Volvo S90 T5 Momentum for $419 a month. Again, you have to pay for insurance but you’ll likely be saving a bundle in the long run — and that’s on a vehicle that starts $10,000 higher than the XC40.

I’m just not sure about these subscription services, especially when they don’t offer a bundle of interesting perks. Lynk & Co, which is using the XC40’s Compact Modular Architecture on its 01 SUV, also pitched a subscription-based sales model that would involve phone-controlled ride sharing services and gobs of in-car connectivity — something Care by Volvo lacks. Perhaps the company is just banking on the ease of having all of your auto bills coming from one source as a selling point. But the fact remains there are cheaper routes to take if you’re willing to.

[Image: Volvo Cars]

Matt Posky
Matt Posky

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.

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  • Jkross22 Jkross22 on Dec 01, 2017

    Convenience fees. That's what this program is all about. Convenience. It's the Ticketmaster of the car world. If you don't want to bother with anything, this is the program for you. Including bothering to see if this deal makes any financial sense.

  • Asdf Asdf on Dec 01, 2017

    There is some sense in what Volvo is doing here, because who in their right mind would want to BUY a Chinese car? But the only appeal Chinese crap has is that it's cheap, and $600 a month isn't cheap, so Volvo had better lower its asking price to something more palatable. How about $50/month?

  • ToolGuy First picture: I realize that opinions vary on the height of modern trucks, but that entry door on the building is 80 inches tall and hits just below the headlights. Does anyone really believe this is reasonable?Second picture: I do not believe that is a good parking spot to be able to access the bed storage. More specifically, how do you plan to unload topsoil with the truck parked like that? Maybe you kids are taller than me.
  • ToolGuy The other day I attempted to check the engine oil in one of my old embarrassing vehicles and I guess the red shop towel I used wasn't genuine Snap-on (lots of counterfeits floating around) plus my driveway isn't completely level and long story short, the engine seized 3 minutes later.No more used cars for me, and nothing but dealer service from here on in (the journalists were right).
  • Doughboy Wow, Merc knocks it out of the park with their naming convention… again. /s
  • Doughboy I’ve seen car bras before, but never car beards. ZZ Top would be proud.
  • Bkojote Allright, actual person who knows trucks here, the article gets it a bit wrong.First off, the Maverick is not at all comparable to a Tacoma just because they're both Hybrids. Or lemme be blunt, the butch-est non-hybrid Maverick Tremor is suitable for 2/10 difficulty trails, a Trailhunter is for about 5/10 or maybe 6/10, just about the upper end of any stock vehicle you're buying from the factory. Aside from a Sasquatch Bronco or Rubicon Jeep Wrangler you're looking at something you're towing back if you want more capability (or perhaps something you /wish/ you were towing back.)Now, where the real world difference should play out is on the trail, where a lot of low speed crawling usually saps efficiency, especially when loaded to the gills. Real world MPG from a 4Runner is about 12-13mpg, So if this loaded-with-overlander-catalog Trailhunter is still pulling in the 20's - or even 18-19, that's a massive improvement.