A Bunch Of Major Car Companies Are Going To Start Making Drivers Pay Monthly Subscriptions To Use Basic Features That Were Previously Free Because Elon Musk Does It With Tesla
Source - Motorists are increasingly being forced to pay tacked-on fees and even sign up for pricey subscriptions to get basic features on their cars — and auto giants are telling investors this is only the beginning.
BMW’s recent move to charge car owners in several countries $18 per month to turn on the heated seats in their own vehicles sparked a public outcry, with some would-be buyers calling the move a “dealbreaker.”
But it’s not just BMW: industry watchers and consumer advocates warn that the nickel-and-diming threatens to become standard as automakers chase a recurring revenue model pioneered by Elon Musk’s Tesla.
General Motors recently started requiring buyers of Buick, GMC, and Cadillac Escalade vehicles to pay $1,500 for the mandatory “option” of buying three years of OnStar service, which includes features like voice control and the ability to unlock vehicles from a mobile app. OnStar had previously been optional since GM introduced it in 1996.
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Toyota, meanwhile, started charging $8 a month to remotely start vehicles using a key fob — a feature that had previously been free. Volkswagen, Porsche and Audi lately have explored similar subscriptions.
It’s just the beginning, industry experts say, as manufacturers look to transform cars from simple goods for sale into bases for recurring revenue that could fill coffers for years or decades.
Well it was fun while it lasted, wasn't it? Car companies have finally woken up. Gone are the days of being able to start your $70,000 BWM from the comfort of your home. No longer will you be able to enjoy your VW's heated seats, zone out behind the wheel of your self-driving Tesla, or even opt out of GM's "mandatory option" OnStar. It's a sad day for car owners and one that we all should've seen coming.
Here's what GM told investors...
General Motors has told investors it aims to generate up to $25 billion in software and services subscription revenue annually by 2030 — up from an estimated $2 billion in 2021. Stellantis, formerly known as Fiat Chrysler, is shooting for $23 billion by 2030.
“Most automakers in the last couple of years have started talking about generating huge increases in revenue over the next decade, primarily off the backs of software and other subscription services,” Guidehouse Insights’ e-mobility analyst Sam Abuelsamid told The Post.
And who do we have to blame for this? Everyone's favorite cool guy billionaire, Elon Musk, who is actually raising prices even more starting September 5th...
The subscription push was pioneered by Tesla. Elon Musk’s electric automaker charges $9.99 per month to access music streaming, satellite maps and other features. It also asks a whopping $200 per month or a $12,000 one-time payment to access its experimental “Full Self-Driving” option.
On Sunday, Musk announced on Twitter his company will hike the price of the FSD option by 25%, to $15,000, starting Sept. 5.
And the worst part of the whole thing is that we can't do anything about it. If these companies want to charge us for everything from heated seats to power windows they can. The only question is how far will they go, which basically comes down to how greedy they get. How much can they pump up prices without losing customers. My guess is "a lot" - people have to drive and they like to feel comfortable and safe while they do it, but who knows. Time will tell. 25% of American's (the dumb ones) said they would be willing to pay extra for services which isn't promising. BMW already charges $12 per month in some countries just to shut off your high beams. The future is bleak, my friends. If I were you I'd move to an affordable, non-driving city like New York where median rent prices just dipped below a reasonable $5k. Better start saving! Have a lovely Tuesday.