The age of connected cars is upon us and now that a number are making it into the second-hand marketplace, their subscription fees are going with them. That fact calls into question who really owns what and whether or not an automaker should control features in a car after it’s legally possessed by another party. Car companies have been planning this for some time and see it as a huge cash cow in the future.
We’ve known for a long while that subscriptions were coming to new cars. Automakers want to charge new car buyers to unlock extra power, navigation, semi-autonomous driving features, heated seats, and more.
Despite the fact that data suggests that most buyers are turned off by features that they have to turn on with extra cash, that hasn’t stopped the industry from doing what they can to branch out into used cars too.
More: Dacia Has A Low-Tech Alternative To BMW’s Heated Seat Subscriptions
That’s made many question whether or not the customer fully owns those features or even the car in question. Some states are trying to find a way to ban the in-car subscription model. At the heart of the matter, automakers simply want to squeeze more profit out of every car. Connected cars make that easier because now there’s a direct line of communication between the owner and the brand, says a report from Wired.
“You spend all the money building the car, you spend all the money designing it and building factories, and yet you don’t get to talk to your customer,” says Gary Silberg, who heads the global automotive sector at the accounting and advisory firm KPMG.
He goes on to say that communication is changing “from occasional contact at dealerships at times of purchase, maintenance, or repairs, to continuous direct customer contact during the entire ownership period.” That shift will likely mean billions in profits for automakers long after they’ve sold the initial car.
That’s backed up by all sorts of evidence including a campaign Ford started in 2021 called “always on”, an effort to “regularly” interact with its customers. Last summer we told you about how Ford’s CEO Jim Farley said that it expected to make “tens of thousands of dollars” on subscription fees in the future.
In December of 2021, General Motors’ CEO made an even larger proclamation that it expected to generate $25 billion annually by 2030 all based on subscriptions. Stellantis got in on the public statement train saying it planned for about $23 billion in yearly subscription revenue by that same time.
