Subscriptions for car upgrades are madness
Let me be blunt: This idea is dumb, shortsighted, brand-destroying and overhyped. And trust me, if it grows further, it will be dealers and their employees who will directly suffer the wrath of angry consumers.
Some of the world’s biggest automakers, including Toyota, Volkswagen and General Motors, have all stared longingly at the potential revenue that could be generated from charging consumers fees to activate or maintain certain vehicle functions.
Last fall, GM said it expected to make as much as $25 billion in annual revenue on software and subscription services by the end of the decade, based on its experience with OnStar. VW is developing its own in-house software company in part because it believes consumers will pay for temporary upgrades such as extra electric vehicle battery capacity or improved performance. And Toyota has implemented trial services for functions on some of its new vehicles that disable if not renewed.
These three are nowhere near alone among automakers in their pursuit of even more almighty dollars. Last week, an erroneous story about BMW planning to charge for heated seats made the rounds online. The story was wrong, but BMW did say that it had made two new Functions on Demand available on some vehicles in the U.S. via software: a dash cam function it calls BMW Drive Recorder and a remote engine-start function.