Carly is Australia\u2019s first flexible car subscription service
\nThe company has just launched a new EV trial product
\nWhy CL8 could be in the box seat to capture the huge EV market<\/p>\n
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People are holding back on buying electric vehicles (EVs) due to concerns such as range anxiety, battery life, and the availability of charging stations.<\/p>\n
The higher sticker price is also an obstacle, but fundamentally, it\u2019s the fear of change and the unknown that\u2019s stopping people from swapping out their internal combustion engine cars.<\/p>\n
Things are gradually changing however. Latest data shows there are now around 180,000 EVs on Australian roads, with almost 100,000 purchased in 2023 alone. But this represents only around 8% of all new car purchases last year.<\/p>\n
With that long runway still ahead, companies like ASX-listed Carly Holdings (ASX:CL8)<\/a> <\/strong>are in the box seat to capture a slice of this potentially huge market.<\/p>\n Carly is Australia\u2019s first flexible car subscription service,<\/strong> which has just launched a new product, the EV trial<\/a>, to answer the very question on many Australians\u2019 minds: \u2018Should I buy an electric vehicle?\u2019.<\/p>\n The product was developed under the premise: \u201cHow can a car buyer really know if an EV is suitable if they can only take it for a short 10 minute test drive?\u201d<\/p>\n \u201cA lot of people are confused about the transition to electric vehicles,\u201d Carly\u2019s CEO, Chris Noone,<\/strong> explained to Stockhead<\/em>.<\/p>\n \u201cThey know that it\u2019s being encouraged by the government, they know it\u2019s probably better for the environment. However, they have a lot of questions about the transition.<\/p>\n \u201cIt\u2019s not just buying another car; it\u2019s actually investing in a new technology. It\u2019s a new way of operating a vehicle. And there\u2019s a whole new vocabulary that people need to learn,\u201d Noone said.<\/p>\n Carly believes that the only way to answer the myriad of questions is to actually give people an opportunity to try an EV before they buy.<\/p>\n The company\u2019s EV subscription program essentially de-risks the purchase by letting people pay for a short term subscription before deciding what sort of EV, if at all, might be suitable for them.<\/p>\n Popular EV models that can be booked online on Carly\u2019s platform include the Hyundai Kona<\/em>, Ioniq 5<\/em> and Ioniq 6<\/em>, Genesis GV60<\/em>, MG MG4<\/em>, BYD Seal & Atto 3<\/em> and Cupra Born<\/em> \u2013 with more models and brands arriving each month.<\/p>\n \u201cA test drive for an electric vehicle is 10 to 20 minutes \u2013 that\u2019s way too short. You don\u2019t have an understanding of charging the vehicle. You don\u2019t have an understanding of the range capability of the vehicle.\u201d<\/p>\n \u00a0<\/p>\n Backed by SG Fleet<\/strong> and Turners Automotive (ASX:TRA)<\/a>, Carly first launched its car subscription business in 2019 after pivoting from a peer-to-peer rental model.<\/p>\n The company\u2019s fleet of vehicles has since grown to over 450 today, which include a combination of electric and internal combustion engine cars.<\/p>\n The minimum subscription period is for 30 days, but the company says a typical customer subscribes a car for 5.2 months.<\/p>\n Noone explained that there\u2019s a difference between a car subscription and rental service. Car rentals are usually between 1 to 14 days, and with carshare, you typically have one hour to one day, and beyond one day, it becomes a very expensive proposition.<\/p>\n \u201cRental car prices also fluctuate throughout the year, especially in high demand periods such as summer summer holidays or school holidays,\u201d said Noone.<\/p>\n \u201cThe other thing with rental is that you can\u2019t choose the exact car.\u00a0With a car subscription, you actually get to choose the exact car you want to drive.<\/p>\n \u201cPeople can select the colour, the model, the brand of vehicle, and the vehicle they book online will be the exact vehicle that they pick up,\u201d he added.<\/p>\n Carly also allows the customer to switch vehicles. So if people\u2019s needs change and they need a larger car, they\u2019re able to switch that vehicle for the period of time that makes sense to them, and then change back to another vehicle later on.<\/p>\n \u201cAll of our prices are presented in weekly rates. The most economical vehicle that we have is $210 per week, and that includes insurance and registration.\u201d<\/p>\n \u201cOur flexible car subscriptions essentially offer a flexible alternative to people who would normally buy or lease a vehicle, but for whatever reason, they can\u2019t commit to that longer term time period,\u201d said Noone.<\/p>\n \u00a0<\/p>\n Carly\u2019s numbers are pretty impressive. In the half year to December, revenue grew 84% to $1.62 million. Gross profit during the half increased by 38% to $444k.<\/p>\n In January, the company gained further momentum as it reported record results for cash receipts and subscriber growth.<\/p>\n Fleet utilisation<\/strong>, an important metric for the business, was up 5% in January to 86%.<\/p>\n \u201cThe high 80% rate is our target utilisation rate. That\u2019s when we have the majority of our vehicles on the road, each of them earning money.<\/p>\n \u201cIt means that our stock costs are reduced for any idle vehicles. So utilisation rate is a key metric that everyone in the organisation knows on a daily basis,\u201d said Noone.<\/p>\n The company has also been growing the fleet of vehicles that it owns.<\/p>\n \u201cWhen we own a vehicle, we take a higher margin on these vehicles, compared to the asset light fleet (vehicles leased from a third party),\u201d said Noone.<\/p>\n \u201cWe want to grow our fleet as quickly as possible, and we want to maintain this high utilisation rate.\u201d<\/p>\n Noone says the next focus will be on grabbing a share of the corporate market.<\/p>\n \u201cThe corporate market has different dynamics to the consumer market,\u201d Noone explained.\u00a0\u201cAnd there are some advantages and opportunities to scale very quickly within that market.\u201d<\/p>\n \u201cBut our focus is on increasing our gross profit figure at an accelerating rate.\u201d<\/p>\n \u00a0<\/p>\n Noone says that Carly has a proven business model that\u2019s been honed over a number of years.<\/p>\n \u201cWe haven\u2019t entered this market with a blue sky idea and testing the proposition. We\u2019ve come into this market with some very good experience and strong strategic partnerships.<\/p>\n \u201cWe have SG fleet, the largest fleet management and leasing company in Australia as our second largest shareholder, and they refer customers to Carly.<\/p>\n \u201cTurner\u2019s Automotive is the largest seller of cars in New Zealand, and they\u2019re our fourth largest shareholder.<\/p>\n \u201cSo we have the backing of those businesses, and we also have very strong strategic relationships who are sharing information in the market,\u201d said Noone.<\/p>\n \u00a0<\/p>\n \ufeff<\/span><\/span>\u00a0 The post ASX-listed Carly takes its car subscription platform up another gear after launching an EV trial program<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"Car subscription vs rental<\/h2>\n
Impressive numbers<\/h2>\n
Solid backing<\/h2>\n
Carly share price today:<\/h2>\n\n
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