Volvo has made sweeping changes to its Care by Volvo subscription program, driven in part by complaints and legal challenges from dealers, according to media reports. The two-year service offers unlimited usage, insurance, concierge, and service and maintenance for a monthly charge that does not include gas, local taxes, or registration.
The changes are expected to take effect nationwide by the end of 2019, starting with 11 New Jersey dealerships in October. For the first time, dealers will be allowed to pull units out of inventory and into the program. Before these changes, every subscription vehicle was ordered from the factory by each new subscriber.
Volvo also added the S60 sedan, V60 Cross Country Adventure wagon, XC60 CUV, and XC90 SUV to the Care by Volvo selector, which was initially limited to the XC40 SUV, available in Momentum trim for $600 per month and TR R-Design trim for $700.
The monthly prices for those two models are now $700 and $750, respectively. The S60 Momentum is also available for $700 per month and the S60 R-Design, XC60 Momentum, and V60 Cross Country Adventure join the XC40 T5 R-Design in the $750 tier. The XC90 is available in Momentum trim for $800 per month.
Notably absent are Volvo’s flagship S90 sedan, the V90 Cross Country wagon, and any top-of-the-line Inscription editions.
Reports suggest Volvo will no longer rely solely on a group insurance policy issued by Liberty Mutual, which prevented some higher-risk drivers from joining the program.
In December, the California New Car Dealers Association sued the factory, claiming unfair competition in violation of state franchise laws. The CNCDA suit also accuses Volvo of de facto payment packing stemming from the fact that every subscriber pays the same monthly price, whatever their risk to the insurer.
Volvo Car USA CEO Anders Gustafsson downplayed the lawsuit, which triggered an ongoing investigation by the California DMV. He accused the CNCDA of picking on Volvo, a relatively small player among North American brands, as a test case.
“Someone is making a mountain out of a molehill,” Gustafsson told Automotive News. “If we have done something wrong, we will change it. We don’t think we have done anything wrong, and it has never been our intention.”
Editor's note: This news item first appeared on AutoDealerTodayMagazine.com, a Bobit Business Media publication.