It seems like everything is becoming a monthly subscription service these days. There’s no reason to expect the trend to skip your driveway. General Motors plans dozens of new features available for a regular free.
“We have 50-some value-added products and services that we’ll be rolling out over the next 36 to 48 months,” Steve Carlisle, president of GM North America, told investors at a conference yesterday.
Carlisle was cagey about what the new features might be but said “The bigger screens on our EVs will enable us to bring more of the data-oriented software products to the customers.”
That likely means entertainment services like streaming movies and video games. It could also refer to services that use data gathered from the vehicle itself, like maintenance planners and systems that coach you to drive more efficiently.
We’re Keeping Our Cars Longer. Automakers Want To Keep Our Money Longer
Automakers make money off most of us only when we buy a new car. But Americans are keeping their cars longer than ever — the average new car on American roads is now over 12 years old. That has some companies looking for ways to bring in revenue from drivers long after they buy their cars.
Carlisle noted that OnStar, the telematics service GM has built into many vehicles since the 1990s, brings GM about $32 per month per customer. OnStar services include remote diagnostics, turn-by-turn navigation, and security systems.
Automakers have begun to experiment with expanding subscription services to more aspects of car ownership. BMW briefly charged a monthly fee for Apple CarPlay phone connectivity but now includes that feature as standard equipment on many models without a subscription fee. Audi has given some European customers the option of paying a monthly fee for advanced headlights, after a free trial period.
Those examples are small, though, compared to what companies have planned.
Subscriptions for Features, and Even Performance
Hyundai has discussed adding a monthly fee for features like heated seats and heated steering wheels. Owners would subscribe and unsubscribe with their phones. Hyundai would turn the features on and off remotely.
Volkswagen last year introduced a concept car that even included performance features as subscriptions. Owners could, for instance, access additional horsepower for an added fee on demand. VW executives, at the time, noted that autonomous driving modes might make an ideal subscription service. Owners could pay to have the car drive on long trips. Automakers would simply need to keep the cost of the service below that of other transit options like trains and airplanes to make the idea work.
GM’s proposal is a long way from that. But the company’s Super Cruise hands-free highway driving system already involves a monthly fee.
A Huge Change in How We Think of Cars
The idea has another benefit for automakers – it could drastically simplify building cars.
When most car features are subscription services, automakers could eschew options and simply build every car with every available feature. They could sell every car for a set price, then collect additional money over time as owners added and subtracted features on the fly. The idea would radically shake up the concept of resale value, as every car always had every feature.
