General Motors has expanded a leasing program for drivers freelancing in the sharing economy to Los Angeles, the third of eight markets the automaker has pegged as the most fertile for mobile app-based delivery services as well as its new Chevrolet Bolt electric vehicle.
Developed by the manufacturer’s mobility arm, Maven Gigallows drivers to rent certain GM cars by the week for a flat fee that can easily surpass $1,000 a month, far more than a traditional car lease. Maven executives say that the program is designed to make freelancing in the gig economy easier. The rental terms include unlimited mileage and commercial insurance without requiring a down payment or credit check. Often, at least one of those factors can keep potential freelancers from driving for a delivery service like Lyft or GrubHub.
However, the benefits baked into Maven’s weekly price – including maintenance, insurance, depreciation – mean that freelancers would pay roughly four times more than the monthly payment on a typical long-term lease. Gig’s weekly rental prices range from $189 for a Chevrolet Cruze to $229 for a Bolt, plus taxes. GM’s Malibu and Impala sedans and Trax compact crossover are also part of the Gig program.
Through the new program, a Gig driver could pay roughly $1,000 to use a Bolt for a month, significantly more than the $329 monthly rate GM is advertising nationally for a three-year lease. (Customers in certain markets have leased the Bolt for even less.) Drivers who rent a Bolt through Gig get free charging – which GM estimates saves drivers about $80 a week – from the automaker’s partner EVgo. But still, Gig’s prices could be difficult for most freelancers to shoulder, especially since they’ll be responsible for parking the car, which can cost hundreds of dollars extra in the cities GM is targeting.
Maven says the program will attract drivers seeking flexible lease terms and open the market to freelancers who don’t have proof of a steady income to lease a car through a dealership. Traditional leasing “is cheaper if you want to commit to a lease, but most drivers aren’t looking for that,” said Rachel Bhattacharya, Maven’s chief growth officer. “Many of them want to try it for a week or two first.”
But Maven Gig could have an underlying motivation: to prop up sales of the Bolt, GM’s long-anticipated, sub-$30,000 mass-market EV that’s finally reaching dealerships nationwide. The Bolt, went on sale in December in Oregon and California touting its 238 mile range, has sold more than 9,500 units for the first seven months of the year, as its rollout continues.
Even though most Gig drivers live in cities where they don’t need to own a car, unleashing scores of Bolts in key cities can help GM compete with Tesla’s own mass-market EV, the Model 3, which took more than 400,000 pre-orders before the company started delivering them to owners last week. “It’s a surprisingly effective brand ambassador situation,” Bhattacharya said. “Even if Gig drivers never, ever are in the market to buy a car, we still have that relationship.”