Car Companies Want To Charge Buyers Monthly For Features Like Heated Seats



How would you feel about paying $5 a month for the ability to lock and unlock your car from a distance through an app? What about a $25-a-month charge for adaptive cruise control, or $10 a month for heated seats? What if those charges continued long after your car was paid off? As vehicles become increasingly more connected to the Internet, car companies aim to rake in billions by having customers pay monthly to access certain features. Not content with the relatively low-margin business of building and selling cars, automakers are eager to pull down Silicon Valley-style profits. Car buyers, however, aren’t so thrilled about the idea. Automakers run the risk of making customers feel like they’re paying twice — once for a function to be built into a vehicle and again to activate it. In a recent survey, 75% of consumers say they’re not willing to subscribe to most vehicle features and will simply do without if charged a recurring fee. A whopping 92% said heated seats should be included as part of the car’s up-front price, and 89% said the same for remote-start functions. New Jersey officials are so upset by the proposal that there’s a bill working its way through the legislature that would ban carmakers from charging a subscription for features that use hardware already built into a vehicle. Still, automakers see dollar signs. Ford and GM each aim to generate at least $20 billion in annual revenue from software services by 2030. As a result, there’s a good chance that Ford and GM will be auto brands that people in the future will talk about as companies that used to sell cars.