In an effort to boost revenue, some automakers have started to offer features via subscription. Once the subscription is made, owners are typically able to unlock the features via software using an app.
Recently, Mercedes-Benz started offering a $1,200 annual subscription to U.S. owners of certain EQ-badged electric vehicles to unlock maximum performance. BMW in some markets has even made features like heated seats available via subscription.
Volvo, which pioneered a subscription model as an alternative to purchasing or leasing a car, is also looking at subscription for features, but only for substantial items.
The information was confirmed by Björn Annwall, Volvo’s COO, in an interview with Bloomberg published last week.
“If you are to charge for software updates, it must be a step change in consumer benefit,” he said.
Annwall gave the example of a self-driving mode as the type of feature for which Volvo may charge a subscription. Volvo has already announced a self-driving feature called Ride Pilot, which will enable true hands-off, eyes-off travel on certain highways. Timing for Ride Pilot isn’t clear, though the first market has been confirmed as California.
Not everyone is keen on the idea of a subscription being required for features, especially when they’re already built into the vehicle and only require software to unlock. Two members of the New Jersey General Assembly, Paul Moriarty and Joe Danielsen, in September introduced bill No. 4519 that aims to make it illegal for automakers and dealers to sell subscriptions for features that use hardware already installed in the vehicle at the time of purchase.
However, the bill leaves a caveat for features that require ongoing expenses to the automaker, dealer, or any third-party service provider, such as content streaming services and newer self-driving technologies that are upgraded over time, for example with new functionalities or greater map coverage.
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