Carmakers Plan to Make Basic Features Subscription, Despite Widespread Backlash

https://www.techdirt.com/2023/12/05/carmakers-push-forward-with-plans-to-make-basic-features-subscription-services-despite-widespread-backlash/

by rntn • 3 years ago

76 73 3 years ago

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francisofascii• 3 years ago

better gas and EV engine performance

Are we talking about better fuel efficiency, acceleration or both? To lock down better fuel efficiency would be downright evil. I am okay with locking down better acceleration.

oivey• 3 years ago

Why are you ok with that? Adding a software governor to the motors just to drag more money out of something you already bought is crazy.

huijzer• 3 years ago

It’s very interesting to see businesses like BMW, Mercedes, Shell and Google obsess over quarterly revenues instead of the long term. I would see it as a red flag as investor, but maybe the main investor in these companies is someone who obsesses over quarterly revenue?

xivzgrev2• 3 years ago

That’s ideal but remember a company is made of thousands of shareholders - execs, employees, investors etc

When the stock price starts going down / not growing as it “should”, everyone is unhappy. Execs can leave, key employees can leave, and investors can launch an activist campaign.

If the story is spun right even “weak” financial performance can lead to strong stock - look at Amazon. There was very little profit for years but that was because they were reinvesting in growth (and seeing results). So people believed and stock price went brrr.

dakial1• 3 years ago

You're mixing shareholders with stakeholders. Shareholders are only the investors. Execs would only care for stocks if their variable is tied to it. Low/mid employees don't really care.

underseacables2• 3 years ago

This is awful. Now we will have to jailbreak our cars just do use basic features.

JohnFen2• 3 years ago

Or avoid buying newer cars. That's what I do to avoid surveillance by the manufacturer, and it would be equally effective for this.

underseacables2• 3 years ago

It would increase the value of older cars.

sickofparadox3• 3 years ago

Many states will ban the purchase of used ICE vehicles eventually just as they have deadlines for banning new ICE vehicle sales, or at least make the process so onerous they might as well have banned them.

hiatus• 3 years ago

Oh there's a way around that. Places like Lisbon and London already have time periods where older vehicles cannot enter parts of each city without paying a fee. It's only a matter of time that they're banned altogether for "the sake of the environment".

sickofparadox3• 3 years ago

Don't worry, I'm sure they'll make that illegal too, just like when they outlawed personal importing of cars from cheaper markets in the name of safety. Because everyone in the car world knows, after 25 years, a car is automatically safe for the road, right?

criddell3• 3 years ago

Because everyone in the car world knows, after 25 years, a car is automatically safe for the road, right?

Nobody is claiming that.

lylejantzi3rd• 3 years ago

When they outlaw non-subscription seat warmers, only outlaw hackers will have seat warmers! Fight the power!

ctoth• 3 years ago

Another thing you could do is just not buy the damn things. As someone who cannot physically drive because I'm blind, the idea that you need a car is already suspect, but regardless, you certainly don't need a 2023+ car with "smart" features. Don't buy them, tell your families not to buy them, let them pile up, unpurchased, on dealer (what a silly idea a dealership is!) lots.

You are still allowed to opt out.

For now.

jcranmer• 3 years ago

Your ability to not need a car is highly dependent on where you choose to live. A coworker of mine got into a car accident a few days ago and has temporarily lost access to a car, and in the process discovered that getting from the house to the airport without a car was far less viable than they expected.

(I say this as someone who is emphatically of the opinion that we should be less reliant on cars!)

nullserver• 3 years ago

Never mind when Covid hit all the buses in our area. Shut down through almost 2 years.

xivzgrev2• 3 years ago

This only works if there are some popular automakers not in on it.

If everyone goes that way then consumers are screwed.

Then inevitably after 10-20 years there will be enough anger that congress will do something about it, but in the mean time the original execs all lived like fat cats and danced into the sunset. Yippee!

etrautmann2• 3 years ago

it'll also increase demand for used cars without these features.

etrautmann2• 3 years ago

exactly this. Start building resistance to these anti-patterns early and often. Reviews need to call this out.

More broadly, business models should only rely on recurring revenue streams for products that are receiving nontrivial updates or for which there are demand-based costs.

Presumably where this gets murky is with AI features, where inference costs are high and one-time fees aren't sufficient or appropriate.

Justsignedup• 3 years ago

The united states is designed to be driven. It was very intentional. In NYC, depending on where you live you don't need a car, but once you get to the outskirts of the boroughs (like outer queens, outer brooklyn, any of staten island that isn't right by the ferry, upper bronx) you basically drive or getting anywhere to anywhere can take hours. And NYC is the best in the country regarding not needing a car.

Many places "going to the corner store" is a 20 minute drive. I still remember going up to long island to visit a friend, and we wanted to eat. The absolutely closest place to get food was a 45 minute walk each direction.

pulse72• 3 years ago

Because building code is US don't allow mixed living/business areas - so you CAN NOT FIND business near the place you are living and YOU MUST HAVE A CAR...

usefulcat• 3 years ago

That's all fine; none of it precludes voting with your wallet by e.g. buying an older car. It's not necessary for literally everyone to do this for it to have a noticeable impact on auto makers.

tonyedgecombe• 3 years ago

I was reading an article about car prices in the UK over the last 50 years. It seems the median car price has increased inline with earnings. This is twice the rate of inflation. It seems car manufacturers have done a really good job on us.

You are still allowed to opt out.
For now.

Opting out of consumerism is probably the most subversive thing most people can do.

m463• 3 years ago

and don't buy a smartphone. or a smart tv.

TheNewsIsHere2• 3 years ago

I would agree that the dealership model for sales is ridiculous.

When you need service from the same company that made your car, dealerships can be a life saver. (Not all of them, of course. YMMV.)

maxwell3• 3 years ago

If cars are computers on wheels now, seems time to buy a case and components and put it together instead of just gettin' a Dell.

Ford's electric crate motor is out now: https://performanceparts.ford.com/part/M-9000-MACHE

Tanoc4• 3 years ago

As far as I know they still don't sell a wiring harness or battery for it, though. So you either have to yoink parts from a dead Mach-E or F-150 Lightning or adapt existing parts to poorly suit the conversion. They've been selling very few of them because of this, and Ford's legal department's too scared to actually sell battery cells that would fit in place of gas tanks or whatever.

maxwell3• 3 years ago

Why are they scared to do that?

eximius• 3 years ago

"Yes, the planet got destroyed. But for a beautiful moment in time, we created a lot of value for shareholders."

I wish we would stop making our lives worse for each other.

houseatrielah• 3 years ago

I was pumping gas and the gas pump decided it should advertise at me and clue me in on the latest celebrity gossip. We really have no concept that we shouldn't degrade the public realm.

callalex• 3 years ago

In that case I think it’s perfectly acceptable to degrade the speaker and screen that were placed in the public realm.

Tanoc4• 3 years ago

Bring expanding spray foam with you and fill in the speaker grille and muffle or mute the sound. Other people will greatly appreciate it and the employees most likely won't care until it comes time for inspection from corporate or state agencies. I've seen it more than once at Speedway stations.

gaws• 3 years ago

"Why make others happy when I can profit (and be happy) from their misery?"

jacobgorm2• 3 years ago

I actually think this makes some sense, based on my own experiences owning various cars.

The first was a Mercedes A200 that had been imported from the Netherlands to Denmark. It did not have heated seats, something I overlooked when I bought it, supposedly not a deal breaker in NL, but a big issue during cold Danish winters. I would have gladly payed a subscription fee to activate seat heating had it been possible, but the car was originally made for another market, so there was nothing I could do except sell it and buy another one.

The second is my current car, a Volvo, which came with a wifi hotspot. For some reason, the hotspot stopped working after a the car was out of warranty, and I found that I am able to live without it, by using my phone as a hotspot instead. In this case I could have stopped paying for a feature that I no longer need. As cars get more laden with tech, I think it is quite feasible that some initially "fashionable" features will get irrelevant over time, and users might like to have to option to stop paying for features that have lost their relevance. If Volvo would upgrade my current sat-nav to Apple Carplay I would gladly pay for that too.

Having users pay recurring would also incentivize car makers to keep investing in updating their software, and perhaps even install hardware upgrades "free" of charge, in the hope that the user would keep paying a recurring fee to have them.

tguvot• 3 years ago

volvo hotspot has independent sim card for internet (different from the one that is used for volvo oncall). usually first few years of service included but after this you need to create account with internet provider in order to get service

jacobgorm2• 3 years ago

I know, but the SIM-card reader broke.

jocaal• 3 years ago

Having users pay recurring would also incentivize car makers to keep investing in updating their software...

Please no. I don't want fancy software that hides essential features 4 layers deep and stops working when the internet is bad and the billing service can't be reached. I want buttons for the features and a display that works with android auto. Nothing more, nothing less.

lsaferite• 3 years ago

Worse, I don't want them moving the fucking UI components around because this 'new thing' is so much better. Just leave the UI alone!

jimbob45• 3 years ago

I would have gladly payed a subscription fee to activate seat heating had it been possible

You would've just had heated seats, no fee required.

fragmede• 3 years ago

so there was nothing I could do except sell it and buy another one.

You could also have bought a heated seat warmer seat cover*, or taken it to an independent service shop to have them install heated seats. Buying a different car was just the solution you choose. Having the hardware but having to pay for it in software wrankles those with a Marxist understanding of value and pricing things, but most of us don't live in such a world.

* https://a.co/d/fnDQRBv

balozi• 3 years ago

If I choose to not activate their features I end up stuck with the cost of hosting their hardware. Those heated seats cost me money to transport, maintain and insure. They should be paying me.

reaperman2• 3 years ago

It may not be the case. The financials could be covered by the deferred revenue of expected subscription adoption.

Perhaps heated car seats would normally cost an extra $1,200. If they predict a 50% adoption rate, they could charge $40/month (raised annually by inflation) and they'd get $2,400 from each subscriber over a 5-year ownership. This way the people who don't use the hardware don't pay for it, their unused hardware is paid for by those who do use it.

If it functioned this way, I imagine some people would figure out how to hack the car to unlock these features without paying for them. I'd even be curious how illegal that would even be -- distributing software hacks might be prohibited by DMCA, but installing a switch that bypasses the infotainment OS entirely and directly connects the heated seats' resistive heating elements to 12V/48V rails or whatever surely wouldn't be in violation of any current laws.

soperj• 3 years ago

This way the people who don't use the hardware don't pay for it

OP was saying they pay to cart it around the country.

rasz• 3 years ago

Perhaps heated car seats would normally cost an extra $1,200.

how do you derive $1,200 from a ~$20 BOM change?

yohannparis• 3 years ago

I can see the benefits, make only one car model. And then let the user decides what to use for a fee. The problem is a lot of cars will have features that will never be used and trashed. Their goal is just how to optimize their production and not their impact on their environment.

tantalor• 3 years ago

They install that true coat the factory, there's nothing we can do. But I'll talk to my boss.

https://www.youtube.com/watch?v=B2LLB9CGfLs

lallysingh• 3 years ago

This article's 90% outrage and 10% material. The idea is still in its infancy so we don't see an impact in prices yet -- there aren't enough models with this function to price out a difference.

Here are my questions:

1. Would this work for much more than small conveniences? Heated seats, steering wheel, wifi, etc? Where it's literally cheaper to build 1 part instead of 2.

2. If it's cheaper to always build in the feature, why wouldn't a competitor just include the feature as standard? The auto market is pretty competitive, and Brother did pretty well just by not screwing up their printers.

3. Will people get turned off at the fear of higher replacement part costs?

4. Has this grown past the small-experiment stage? Is it any more than BMW heated seats?

criddell3• 3 years ago

GM dumping CarPlay / Android Auto fits this as well. GM thinks they can generate $20-$25 billion in annual subscription revenue within 6 years and they can't do that if you can just connect your phone and use that.

gizmo2• 3 years ago

The underlying issue here is that European car manufacturers are in deep financial trouble. Employees are getting more expensive. Cars are getting more complicated and contain more chips. This increases R&D expenses. Margins are getting squeezed. Asian competitors are on their tails. Lexus and Mazda are attacking the lower end of luxury cars and Chinese manufacturers are the only ones that can produce economy (electric) cars at a profit.

European carmakers are looking into subscriptions, knowing it will anger their most loyal customers, because their main business is struggling. They look at sofware companies with envy. To put it in perspective, Volkswagen, Europe's largest carmaker with 675,000 employees has the same market cap as Crowdstrike and Snowflake.

sgt101• 3 years ago

I think that the problem is that cars are getting simpler and contain less precision engineering.

Making a ICE drive chain is very very difficult, there is a long supply chain required. This moat is drying out very very fast.

gizmo2• 3 years ago

Cars are getting way more complicated. Just look at all the tech inside of modern headlights and side mirrors. Don't you think you need a complicated supply chain for all the sensors in modern cars?

ICE drive trains aren't impossibly complicated. It's 200 year old technology that has been near perfected. Modern engines last 200k miles no sweat and require little more than an oil change. BEV is simpler in some ways but more complex in other ways. BEVs are much heavier and that means you need more structural components, heavier suspension, more complex crumple zone, etc. Electric cars also can't be repaired as easily. BEV aren't simpler than ICE cars, it's just a different set of costs/benefits.

Tanoc4• 3 years ago

No. Definitely not. The drivetrains swap has made them simpler in that regard. But ever changing and increasing safety standards mean that a single bodystyle costs hundredss of millions of dollars to develop. Mostly caused by SUVs and CUVs that make the physics of an impact much harsher. The widespread popularity of the Jeep Cherokee and Ford Explorer in the early 1990s have been detrimental to so many facets of the modern world...

mgarfias• 3 years ago

This crap is why I probably won’t buy another new car, ever.

I’ll find an old 72 travelall and swap the motor/trans for something modern and efficient and say screw the automakers.

One exception: a new c8 z06. I might get one, if my dealer gets an allocation and I have all my ducks lined up AND I can get it with no markup.

Which… isn’t happening

taylodl• 3 years ago

All BMW, Mercedes, et. al. are doing is creating a market for someone to come in and eat their lunch.

The way things are going BYD will be able to come in next year and make a killing.

thegrim33• 3 years ago

There's too much regulatory capture for any newcomer to start up and produce anything different and not go bankrupt. Tesla was such a lucky exception; they had to raise tens of billions of dollars of investment and still were on the verge of bankruptcy multiple times.

As an interesting anecdote, Ford was founded with the 2023 equivalent of less than a million dollars.

pulse72• 3 years ago

Car features subscription: 1) create new product (car) -> 2) Lobby for a lot of regulation so only a few companies can make a product -> 3) Abuse market position to extract money from customers (car feature subscriptions)

Am4TIfIsER0ppos• 3 years ago

What are you going to do? Drive an old car? Government has a solution for that!

rekabis• 3 years ago

If purchasing is not ownership, then pirating is not theft.

I think more technically-gifted people need to look into these “subscription” systems, in order to find workarounds. Because if it comes with my car, _it’s mine to do whatever the f**k I want with it._

Carmakers Plan to Make Basic Features Subscription, Despite Widespread Backlash

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