Cazoo buys Cluno as CaaS options increase
01 March 2021
Cazoo has acquired German car-subscription service Cluno, as it looks to expand its car-as-a-service (CaaS) offering.
Cluno offers customers an alternative to traditional car ownership, with 100 different makes and models available for a single monthly fee. This includes the car, maintenance, servicing, warranty, tax and insurance. CaaS is a growing trend, giving consumers the option to have a vehicle when they need it and swap or hand it back depending on their requirements.
Having recently bought Drover, a UK CaaS business, Cazoo's latest move will help to accelerate its international expansion strategy. The deal puts the company in a strong position as the automotive industry grapples with the effects of COVID-19. Offering both used-vehicle sales via an online platform and CaaS means it can profit from changing consumer-spending patterns.
UK-based online used-car platform Cazoo has already delivered almost 20,000 cars to consumers across the UK since its launch one year ago. Cluno was founded in 2017 and has a team of 100 workers at its headquarters in Munich. The financial details of the transaction have not been revealed.
′Cluno has built a market-leading offering in the car-subscription market in Germany with thousands of loyal customers,' said Alex Chesterman, founder and CEO of Cazoo. ′We will be launching the full Cazoo proposition in Europe later this year from our new European headquarters in Munich, and we look forward to offering customers the option of purchasing, financing or subscribing to thousands of Cazoo cars.'
According to subscription site Wagonex, traditional forms of ownership cost UK consumers almost £1 billion (€1.2 billion) in payments for vehicles not used during COVID-19 lockdowns. The company says enquiries about its CaaS options have increased 250% since September last year.
Wagonex owner Toby Kernon said: ′the shift towards the subscription model of car ownership has been coming for a while and, before lockdown, research suggested subscriptions would account for 10% of all new registrations by 2025.
′In reality, the effects of lockdown have accelerated the shift towards car subscriptions. When you consider that 80% of drivers did not use their cars at all during lockdown, while spending an average of £226 a month for the privilege, it is easy to see why people are making the shift towards flexible ownership.'
COVID-19 has led to an increase in working from home, cutting down vehicle usage as a result. CaaS offers a more affordable way to use a vehicle without the commitment to long-term finance options or other costs. Together with mobility as a service (MaaS), consumers have more options should they look to turn away from traditional car ownership. This is a reason why carmakers have invested in mobility services, ensuring they can still profit despite a changing automotive landscape.