AU’s Carbar raises $16.8m from IAG, private investors to grow car subscriptions

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Australian car subscription platform Carbar raised $16.8 million from IAG, the country’s largest general insurer, and private investors.

Founded in 2016, Carbar is Australia’s first car subscription platform, catering to customers seeking alternative modes of vehicle ownership.

The deal saw IAG taking a majority stake in the company.

According to a statement, Carbar plans to use the capital raised to expand its vehicle subscription model while supporting the growth of its online car trading platform. Going forward, the company plans to expand its services to new cities across Australia. In June, it forayed into Sydney.

The deal enables IAG to focus on emerging mobility trends that are guided by rising demand for flexible car subscription services.

The deal will see both IAG and Carbar collaborate on marketing, technical support, and distribution opportunities to cater to customers’ mobility needs.

IAG’s executive general manager of innovation James Orchard said: ‘Carbar has pioneered the car subscription model in Australia. We look forward to combining its world-class digital capabilities with IAG’s assets and scale to provide new mobility experiences for customers today and in the future.”

Des Hang, CEO and co-founder of Carbar said that the automotive industry is reaching an inflection point with massive changes towards car ownership happening across Australia and globally.

“New car sales for combustion engine cars are down globally, and Australia isn’t immune from this trend. Earlier this year, we saw the merger of two of Australia’s largest car dealership operators as a result. Carbar is operating and growing around these trends, so we believe we will be well-positioned to capitalise on these new markets that are emerging as a result of it,” said Hang.

Carbar last raised a $5.8 million venture round in August last year, according to Crunchbase.