Collaborate to export Carly car subscription service to NZ alongside Turners Automotive Group
Collaborate will licence its Carly vehicle subscription service to Turners in order to court the NZ market.
Sharing economy proponent Collaborate (ASX: CL8) is on course to export its suite of car market services to New Zealand after striking a deal with Turners Automotive Group (ASX: TRA).
Turners is a NZ-based integrated financial services group, primarily operating in the automotive sector and is currently the largest car seller in NZ.
Meanwhile, Collaborate operates peer-to-peer marketplaces that enable individuals and companies to transact with each other for mutual benefit. The company claims to disrupt traditional business models by cutting out the middleman and allowing owners and renters to transact directly with each other, monetising assets that would otherwise sit idle.
Collaborate’s Carly brand launched in March 2019 and is Australia’s first truly flexible car subscription offering.
This latest deal with Turners means Collaborate will launch its Carly platform in NZ as part of joint subscription service that will kick-off in July this year.
“We are excited about the partnership with Carly as we position Turners for the long-term projected changes in the traditional retail car market,” said Todd Hunter, chief executive officer of Turners.
“New concepts such as vehicle subscription and car-sharing are a part of the future and provide a new revenue opportunity for car dealers and other industry players. We really like the industry inclusive approach Carly has taken in Australia which we will mirror in NZ,” he said.
Gearing up for launch
According to Collaborate, the duo will launch Carly.co.nz which is in line with Turners’ strategy to invest in opportunities adjacent to its core automotive business.
The new subscription service will implement an aggregator-based model which provides an opportunity for Turners to add value to its existing business models, deliver significant benefits to its customers and address the changing way consumers are thinking about vehicle access and ownership – a strategic outlook shared by Collaborate.
Following lengthy negotiations, Turners has opted to make a $1 million “strategic investment” combined with an exclusive negotiating period for the launch of the subscription service.
To get the Carly service up and running, Turners has agreed to supply 200 vehicles to the Carly fleet within six months of launch, sourced from their own stock and partners including automotive dealers, manufacturers and fleet managers.
According to the terms of the deal, Carly intends to generate income from a platform licence fee based on subscription revenue as well as conducting “custom technology development” and providing customer service.
“Turners is the largest seller of cars in NZ and in an ideal position to meet the needs of customers who prefer access over ownership,” said Chris Noone, chief executive officer of Collaborate.
“Turners has an unequalled marketing capability and network of industry partnerships that will provide Carly with an excellent opportunity to grow rapidly in NZ,” he added.