ATLANTA, Aug. 13, 2018 /PRNewswire/ -- Cox Automotive is bringing together its investments and solutions supporting the future of mobility with the formation of a new business division: Mobility Solutions Group. For years, Cox Automotive has been investing in technology and services that position the organization to deliver advanced fleet management solutions and support evolving consumer mobility. The new business division, which is focused in part on mobility as a service, will house these solutions and investments, as well as newly-acquired Clutch Technologies, a technology platform powering subscription access for the automotive industry.
"Cox Automotive is continually evolving – delivering digital retailing solutions for the immediate term while developing and investing in solutions that will fuel new models for consumer mobility and enable fleet management solutions well into the future," said Sandy Schwartz, president, Cox Automotive. "The future of mobility as a service is a massive business opportunity, with some estimates at well in excess of $1 trillion by 2030. Our goal is to grow our presence in that part of the business and help all our partners and clients successfully navigate the many new opportunities."
Cox Automotive is bullish on the future of automotive subscriptions. In 2014, the company created Flexdrive, a vehicle subscription technology and services company. A joint venture with Holman Enterprises since 2017, Flexdrive enables dealers and fleet owners to offer on-demand vehicle subscriptions to consumers via mobile devices. With Clutch, a consumer-focused subscription technology platform that is now part of the Cox Automotive family of brands, the company's reach and expertise expands further. Clutch Technologies was invented and incubated as part of Cox Enterprises' Innovation Fund. Cox Enterprises is the parent company of Cox Automotive.
Cox Automotive Mobility Solutions Group will be led by President Joe George, who previously served as the interim president of the Media Solutions Group, made up of brands Autotrader, Dealer.com and Kelley Blue Book. David Liniado, vice president of new growth and development, Jenny Bedard, head of finance, and Vince Zappa, president of Clutch Technologies, will report to George and help build a team to further develop Cox Automotive's mobility capabilities.
"Cox Automotive has played a large role in introducing vehicle subscriptions to the marketplace," said George. "And, we're already pros at reconditioning, managing vehicles as assets, perfecting the consumer experience and developing elegant software solutions to make complex operations more efficient and profitable. We're looking forward to helping clients disrupt the traditional car buying and ownership models in ways that are advantageous for their businesses."
In addition to investing in automotive subscriptions businesses, Cox Automotive is delivering fleet services through relationships with car-sharing and ride-hailing companies such as BMW's ReachNow, Getaround and Lyft. Cox Automotive has invested in new mobility and autonomous players including Ridecell, a ride-sharing and car-sharing technology platform, and Ouster, a maker of LIDAR sensors for autonomous vehicles. Cox Automotive has also invested in Getaround, a consumer car-sharing platform that empowers users to instantly rent and drive great cars shared by people in their city.
As consumers increasingly turn to shared fleets to meet their mobility needs, it will be essential for fleet owners and operators to ensure the maximum in-use time for their vehicles. From servicing vehicles quickly to reducing cleaning time between riders or drivers, the processes will need to be executed efficiently. Today's technology and processes don't account for the shifting paradigm in consumer mobility, and Cox Automotive is uniquely positioned to deliver the physical and digital solutions to fill that gap.
For example: Manheim, with its 78 physical locations that span 6,500 acres across the U.S., has already invested $27 million in its reconditioning operation since 2015. The vehicle remarketing company reconditioned 2.9 million vehicles last year alone at Manheim facilities. One-stop recon capabilities benefit fleet owners who need vehicles quickly cleaned and maintained on a regular basis.
Additionally, RMS Automotive has helped sell more than 1.4 million vehicles globally through digital Private Stores for OEMs, captives and other large vehicle portfolio owners. In fleet management, vehicle portfolio management is the disciplined approach to managing a portfolio throughout its lifecycle and is critical to profitability. As part of that, RMS Automotive helps fleet owners with remarketing and knowing exactly when to sell units and for what price in order to increase portfolio returns and residual values. RMS Automotive's AI-powered Optimization product suite provides fleet owners the vehicle-specific insights that drive data-driven decisions and improve overall portfolio performance.
Clear signs of how the automotive industry is being transformed by technology can be seen in the 2018 Cox Automotive Evolution of Mobility study, which will be published later this month. Mobility services are beginning to be more widely embraced by consumers as an alternative to traditional vehicle ownership with ride-hailing usage nearly doubling and car sharing and vehicle subscription services gaining traction.
Research shows that consumer attitudes about the necessity of vehicle ownership are gradually changing, with 39 percent of respondents saying access to mobility is necessary, but owning a vehicle is not, a 5 percent increase since 2015. For urban consumers, 57 percent indicate access to mobility is more important than vehicle ownership, a 13 percent increase since 2015. This means increasingly more consumers are prioritizing technology solutions that provide easy mobility over traditional vehicle ownership.
By bringing together its investments and technologies into a new business division, Cox Automotive can more quickly capitalize on the shift from vehicle ownership to usage.
What the Clutch acquisition means
Subscription access is now available in 26 states across the U.S. through Clutch's growing roster of partners including BMW, Mercedes-Benz and Porsche as well as approximately 30 dealer groups. Clutch was one of the first to offer the ease and accessibility of vehicle subscriptions in 2014.
"Cox Automotive's formation of the Mobility Solutions Group will accelerate our plans to activate subscription access across the entire automotive industry by integrating the Clutch technology platform into Cox Automotive's core business," said Zappa. "The combined power of our technologies will fuel great advancements for our clients and consumers alike."
How the Clutch platform works
The Clutch platform provides the intelligence, capabilities and tools required to deliver vehicle subscriptions, including:
- A white-label solution that extends the customer relationship outside of the showroom and into consumers' driveways.
- Management of vehicles using Clutch's patent-pending technology which uses artificial intelligence to assign the right vehicle to every subscriber while maintaining a low ratio of vehicles to paying subscribers, thus keeping costs in check.
- Powerful data on subscribers' needs and behaviors. The Clutch platform learns, remembers and anticipates what is important to every subscriber in order to build deep, trusted relationships.
- Subscription workflow tools to facilitate easy operational integration and delivery.
About Cox Automotive
Cox Automotive Inc. makes buying, selling and owning cars easier for everyone. The global company's 34,000-plus team members and family of brands, including Autotrader®, Clutch, Dealer.com®, Dealertrack®, Kelley Blue Book®, Manheim®, NextGear Capital®, VinSolutions®, vAuto® and Xtime®, are passionate about helping millions of car shoppers, 40,000 auto dealer clients across five continents and many others throughout the automotive industry thrive for generations to come. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately-owned, Atlanta-based company with revenues exceeding $20 billion. coxautoinc.com
Clutch's mission is to enable vehicle subscription across the automotive industry. Clutch's fully integrated platform handles all of the consumer interaction along with the management and workflow tools required to deliver a branded vehicle subscription service. Today, Clutch's technology is powering flexible subscription services for dealers and OEM's in 26 states across the country. Learn more about Clutch at driveclutch.com.
SOURCE Cox Automotive