Carmakers Push Forward With Plans To Make Basic Features Subscription Services, Despite Widespread Backlash

(Mis)Uses of Technology

from the breathing-clean-air-will-now-cost-extra dept

Automakers are increasingly obsessed with turning everything into a subscription service in a bid to boost quarterly returns. We’ve noted how BMW has embraced making heated seats and other features already in your car a subscription service, and Mercedes has been making better gas and EV engine performance something you have to pay extra for — even if your existing engine already technically supports it.

And despite widespread backlash (BMW had to backtrack on many of its plans), the auto industry shows absolutely no indication they’re going to back away from their plan, with numerous automakers currently working on efforts to “subscriptionize” basic functions and features. And now they’re apparently trying to pretend that this shift is necessary to finance the shift to EVs:

Alistair Weaver, editor-in-chief at Edmunds, says automakers are counting on the new revenue stream to pay for the expensive transition to electric cars.

“So if your car payment is 600 bucks a month, it’s now $675,” Weaver said.

There are several problems here. One, most of the tech they want to charge a recurring fee to use is already embedded in the car you own. And its cost is already rolled into the retail cost you’ve paid. They’re effectively disabling technology you already own, then charging you a recurring additional monthly fee just to re-enable it. It’s a Cory Doctorow nightmare dressed up as innovation.

The other problem: nobody genuinely wants this shit. Surveys have already shown how consumers widely despise paying their car maker a subscription fee for pretty much anything, whether that’s an in-car 5G hotspot or movie rentals via your car’s screen. Other studies indicate that consumers are generally opposed to making functions subscription based, unless they wind up paying less overall:

Alix Partners, a global consulting firm, found that more than 60% of consumers are willing to consider subscribing for enhanced safety and convenience features as long they don’t feel like they are being charged for something they already paid for.

“A lot of people in the auto industry certainly use Apple as a shining light on the hill,” said Mark Wakefield, Alix Partners CEO.

“The car has to be cheaper, plus this option of subscribing,” Wakefield added.

But there’s zero chance that consumers will ever pay less. I’ve often seen carmakers like BMW try to pretend that turning heated seats and other features into recurring subscriptions lowers the vehicle retail cost, but I’ve not seen any evidence to indicate that’s actually true.

The entire point of integrating subscription systems like these is to please Wall Street’s insatiable, often myopic desire for consistent, upwardly scaling, improved quarterly returns. Once implemented, the subscription costs will inevitably be jacked steadily skyward to please Wall Street. It’s simply how these things work. The end result is higher overall costs, and annoying new subscription systems to manage.

There’s a whole bunch of additional unintentional consequences of this kind of shift. Right to repair folks will be keen on breaking down these phony barriers, and automakers (already busy fighting tooth and nail against right to repair reform) will increasingly respond by doing things like making enabling tech you already own and paid for a warranty violation.

The shift toward endless subscriptions for basic functions may not annoy folks with endless piles of disposable income, but for the majority of Americans that struggle to even afford new vehicle costs already, it’s hard to not see this impacting new car sales — or driving more users to older, used cars with dumber tech.

Filed Under: automobiles, cars, consumer rights, fees, heated seats, right to repair, subscription service