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Auto giants like BMW, GM and Toyota make drivers ‘subscribe’ for basic features


Motorists are increasingly being forced to pay tacked-on fees and even enroll for pricey subscriptions to get basic features on their cars — and auto giants are telling investors this is barely the start.

BMW’s recent move to charge automobile owners in several countries $18 per thirty days to activate the heated seats in their very own vehicles sparked a public outcry, with some would-be buyers calling the move a “dealbreaker.”

However it’s not only BMW: industry watchers and consumer advocates warn that the nickel-and-diming threatens to turn out to be standard as automakers chase a recurring revenue model pioneered by Elon Musk’s Tesla.

General Motors recently began requiring buyers of Buick, GMC, and Cadillac Escalade vehicles to pay $1,500 for the mandatory “option” of shopping for three years of OnStar service, which incorporates features like voice control and the flexibility to unlock vehicles from a mobile app. OnStar had previously been optional since GM introduced it in 1996. 

Toyota began charging for its key fob — a feature that had previously been free.Bloomberg via Getty Images

Toyota, meanwhile, began charging $8 a month to remotely start vehicles using a key fob — a feature that had previously been free. Volkswagen, Porsche and Audi currently have explored similar subscriptions.

It’s only the start, industry experts say, as manufacturers look to remodel cars from easy goods on the market into bases for recurring revenue that might fill coffers for years or a long time.

General Motors has told investors it goals to generate as much as $25 billion in software and services subscription revenue annually by 2030 — up from an estimated $2 billion in 2021. Stellantis, formerly often known as Fiat Chrysler, is shooting for $23 billion by 2030.

“Most automakers within the last couple of years have began talking about generating huge increases in revenue over the following decade, primarily off the backs of software and other subscription services,” Guidehouse Insights’ e-mobility analyst Sam Abuelsamid told The Post.

BMWBMW fans have raged on the automaker charging for access to already-installed heated seats. Anadolu Agency via Getty Images

“The approach that these firms are taking up to now is actually not customer friendly,” he added, singling out GM’s mandatory OnStar as effectively a “bogus” and a “hidden price hike.”

The subscription push was pioneered by Tesla. Elon Musk’s electric automaker charges $9.99 per thirty days to access music streaming, satellite maps and other features. It also asks a whopping $200 per thirty days 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 worth of the FSD option by 25%, to $15,000, starting Sept. 5.

Abuelsamid said that other automakers are “fooling themselves” with their plans to juice revenue through subscription plans — and predicted they’ll run into consumers’ “subscription fatigue,” a trend recently evidenced by Netflix bleeding about 1.2 million subscribers in the primary half of 2022. 

Just 25% of American automobile buyers say they might potentially be willing to pay extra for subscription automobile features, based on a Cox Automotive survey from April. 

BMW’s moves toward a subscription model, which Abuelsamid called “particularly aggressive,” have especially angered fans and would-be customers. 

After news reports circulated in July about BMW’s $18-a-month heated seats charge in the UK, Germany, South Korea and other markets, the luxurious automaker was roundly roasted online. 

One TikTok video with greater than 24,000 likes showed a BMW locking basic features just like the speedometer and radio, demanding money for the renewal of a “premium membership.”

One other video with greater than 160,000 likes showed a BMW careening off a cliff with the caption, “POV: latest BMW owners after they forget to pay their monthly steering subscription.” 

Safety concerns aren’t entirely a joke, based on Consumer Reports’ associate director of safety policy Will Wallace. BMW currently requires automobile owners in some countries to pay roughly $12 per thirty days to access a security feature called “High Beam Assistant,” which mechanically turns off a automobile’s high beam lights when it senses one other automobile to avoid blinding other drivers at night. 

“Safety should come standard,” Wallace said of adaptive headlights. “Some automakers might think that those are simply a convenience feature, but there’s a demonstrated safety profit.”

Each Wallace and Abuelsamid said the National Highway Traffic Safety Administration should require automakers to place adaptive headlights in every automobile, similar to airbags and seatbelts. 

TeslaElon Musk’s Tesla pioneered charging for subscription software features. POOL/AFP via Getty Images

While luxury auto brands are taking probably the most flak for subscription features, mass market automakers will increasingly embrace the strategy in the approaching years, predicts National Association of Consumer Advocates executive director Ira Rheingold.

“It should definitely work its way down market,” Rheingold said of subscriptions. “There’s no way that this just isn’t coming to your basic automobile.”

He compared the change to how airlines have increasingly hit consumers with fees for services that were previously free, equivalent to carry-on baggage and seat selection.

“Drip by drip, people turn out to be more accepting of it,” Rheingold said.

BMW, Toyota and GM didn’t reply to requests for comment.

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