There was an article a couple of days ago in the UK-based Autocar that spoke with several high-ranking executives at Hyundai and their Hyundai Collected Mobility division. What these executives said were the sorts of things that sent chills down my spine – chills of irritation and dismay, because they were saying things like “For years we worried about how we were going to sell more cars. Today we worry about ‘what if all we do is sell cars?'” and talking about heated seat subscriptions and that sort of thing, but calling it “personalization in the car” instead of what most consumers call it, which is “bullshit.” Does anyone like subscribing to car features?
Here’s what Autocar reported Marcus Welz, head of Hyundai Connected Mobility, said:
“We are looking at feature-on-demand as an option, in order to add more personalization in the car.”
“Feature on demand” is how marketing people refer to features your car was built with, and has the hardware already installed, hardware that you pay in either fuel or electricity costs to haul around with you wherever you go, but the people who built your car decided that you can’t access unless you pay – features like heated seats or connected services of some kind.
Hyundai also stated that the subscription service could be used to “bring new features into older cars,” which is an interesting concept, though it also brings up some questions. I realize that there could be purely software-based upgrades that could improve things on older cars: user-interface updates to the infotainment systems, perhaps, or new applications for the car that used the existing hardware, but there are, of course, limits.
Sure, it’s theoretically possible that new battery management software could improve battery range or even motor power via the motor controller or something – I’m not ruling that out – but to get real, substantive gains for the future, a carmaker might choose to write software that deliberately doesn’t maximize the potential of their hardware, and then they can roll out “upgrades” that release potential that was previously trapped. I’m not saying this is necessarily Hyundai’s plan, but it has to be noted that this is a very real possibility for any company with similar ideas.
I understand the motivation from carmakers to do this sort of thing: they want a means to keep generating revenue from their customers after they already bought the car. The quote from Welz,
“For years we worried about how we were going to sell more cars. Today we worry about ‘what if all we do is sell cars?'”
… pretty much sums that up, but it also is a concept that I do not feel consumers want anything to do with. There’s rarely been concepts in the automotive world that seem to have engendered such universal disdain and disgust among car owners as having to subscribe to features already built into your car, at least in part because the flip side of that means there can be features in a car you own that the carmaker keeps you from using, and that is absolutely maddening.
Nobody wants this. Carmakers want it because they want your money. But consumers want to keep their money, and it’s natural for them to feel resentment at carmakers for trying these sorts of persistent tactics to chisel more money from the customers who paid good money – and likely with a loan, are still paying good money – to drive the car. How much money do these car executives need, they may wonder? Would it kill them to enjoy a delicious can of dog food every now and then, like the fantastic Ol’ Roy Country Stew, complete with peas and carrots and mouth-watering cuts of what could possibly be beef? Heat it up, and who would even know you’re eating non-human-rated food? Are they really too good for that?
There’s also the issue of longevity; we’ve seen how cars with connectivity features that used older networks that have been “sunsetted” have fared, and it’s not great. Features that the car once had are now dead, and there’s nothing the average car owner can do about it. What’s the guarantee that this sort of thing won’t happen again to subscription-based features that require contacting a remote server to operate? There really is no guarantee.
I reached out to Hyundai PR here in America to see if feature subscription plans were being considered here as well, but have yet to hear back so far. So, until I do, I’ll just speak from the heart and implore them to give this matter a lot of careful thought, and think about what their buyers actually want. If people are clamoring for features they have to pay for on demand, I’m sure as hell not hearing it, and based on how this concept has worked in the past, I don’t see this as being a hit.
If anything, I think Hyundai could do far better if they made a point of being a carmaker that refuses to have subscription services, and really pushes the idea that when you buy a Hyundai, you own that Hyundai, and that includes all the features your car is capable of, which you decided on when you bought the car. You’re not lugging around things you can’t use, you’re in no danger of losing functionality if your financial circumstances change, and, most importantly, your car is yours, not a loan from some faraway automaker that you have to deal with every time your ass is cold in the winter.
I don’t think anyone cares how this concept is spun or if it’s called on-demand-features or whatever. It feels wrong, and car buyers seem to hate it. So, Hyundai, please, think before you commit to this path. There’s still time.
Y’know what’s funny is that at least a W124 Mercedes-Benz E300 with a car phone and a six CD changer isn’t obsolete, because you can get a 4G LTE conversion kit and replace the head unit. Modern cars with integrated touchscreen displays that manage the electronic systems? That shit ain’t comin’ out.
Sidenote I absolutely love the people who do the 4G conversions and keep using those old car phones. It’s delightful.
Given how bad security is on vehicle systems, I don’t think it will be long before “aftermarket” services pop up to beat this subscription based bollocks.
Oh good, so you’re saying I could get Norton Antitheft popups on my dash too?
Gawd, what a depressing thought…
The big part of this is that most consumers (especially the innumerate) will not know to calculate the Present Value of any subscription feature, and then negotiate with the dealer to cut that in half and pay for it upfront.
Dealers can count on the average American being too dumb to understand math.
So, $10/month for 20 years at 5% annual interest is worth around $1500 today.
Not a strident anti-capitalist but sadly I don’t see how this won’t become another race to the bottom akin to airline fees. It seems like automakers are missing that they are the iphone/android in this equation, not the XYZ app. If anything they need to open up something akin to APIs to allow third parties they can then profit off of in an app marketplace. What they are trying to do doesn’t really exist anywhere (yet-shockingly)
I could maybe get on board with this not totally sucking if it was something akin to the freemium model-or at least if it led to MUCH lower car starting prices. Then they try to sell me upgrades to improve my base model, but if subscriptions allowed us to get basic functional vehicles for cheap I could see it. But that’s not what’s likely to because the hardware is the expensive part. And IMO this is the part they fundamentally don’t understand-they’re hardware makers NOT software makers. And hilariously all of these companies universally, even Tesla who is head and shoulders better at it, have garbage software, why would anyone want to pay them for more badly designed and engineered software features. Ioniq 5 N is a perfect example of this, incredibly engineered hardware, but the car’s operating system UX is atrocious based on every review I’ve seen of it.
I also fear for the used market if this becomes common, does anyone trust these companies to have good service or support for 2nd or 3rd owners? Now, I admit being able to buy an old BMW that didn’t have heated seats and auto wipers and enable them 10-15 years later seems sorta cool-but somehow I just don’t trust that will actually happen.
It exists in cameras, except that it’s the complete reverse, consumers love it, and it’s become a competive advantage. OEMs now routinely update firmware that adds features to cameras they’ve already sold you. Faster autofocus, the ability to track the eyes of pets and wildlife, the ability to bracket exposures in new sequences for astrophotography. Sony is great at it, and it’s become a real differentiator for them. Nikon is just starting to get caught up.
That’s not what’s going to happen with cars, and I assume at some point I’ll buy certain cars I like less, just because I so much hate the manufacturers of better cars who play with subscriptions.
As a fellow photographer I love that you brought this up! Great point, Fuji also has developed a reputation for improving their cameras over time at not cost-and this even benefits owners who bought their camera used.
This feels like enshittification, as if Hyundai wasn’t already saddled with dealers so skeevy I won’t shop there. I can live without subscription car options longer than they can live without revenue.
I wonder if this will be like what BMW had where you can either subscribe to the feature as needed which lets you save money if you lease or buy it for the same one-time price as you always have been able to. Based on what I read about the BMW plan I can pretty much guarantee nobody will mention the one-time purchase so they can get those sweet rage-clicks with the “you’ll pay forever for heated seats” implication.
Funny how there aren’t really any basic cars anymore. Our 2016 Kia has heated and cooled leather seats, heated rear seats and a heated steering wheel. It’s also a plastic compliance EV that is as boring as a dishwasher. It only cost $16k used. But there are zero subscriptions for it, and I laugh when “fancy” car manufacturers like BMW talk about subscriptions for these items. I’ve never leased a vehicle, but I think if the options are in the car when you sign the paperwork for a purchase, you should have access to them. Base model cars won’t be offered since insurance won’t want to cover them and the manufacturers lose money on making them. Luxury builders are in trouble when all the fancy lighting and features are commonplace nowadays. They need to work on styling and dynamics to command the high asking price.
The long dark march of the MBAs continues
Seriously, if all business schools were teleported into another dimension, businesses would begin to improve as the existing MBA’s slowly died off or were torn limb from limb by angry villagers who don’t want to subscribe to heated seats.
“How can we best maximize extremely short term profit while tanking our reputations and destroying the product?”
that should be Ford’s new motto.
This is the sort of thing that works on Powerpoint (“Pay for only what you want, when you want it!”) but has a difficult-to-describe ick factor in reality. I think that ick factor basically comes down to the idea that if we all know the car was built with the capacity to deliver the feature and the marginal cost of activating the feature is zero, then it just feels crappy to do business with a manufacturer that wants to be paid twice for the feature (and the second time, on an ongoing basis). Even if I don’t want the feature!! Even worse, they want to have control over your car to do so, leaving you feeling like you’re renting it. At the end of the day even non-enthusiasts want their car to make them feel good and like it’s theirs, and prefer to do business with folks who don’t seem like they will be continually attempting to find new ways to get money off of you years after you bought the car.
I can’t believe automakers are still considering this. Everyone knows that the only ridiculous nickel-and-diming consumers will accept is in the Porsche configurator… Oliver Blume’s twilight zone where its perfectly acceptable to upgrade to leather vent louvers, tantalum wiper blades, and deviated stitching on air filters.
They’ve been accepting it with BMW for a long time. Sun visors are included. Extending sun visors like you find in base-model Hyundais? Now that’s gonna cost you extra.