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With the industry-wide chip shortage affecting profits across the board, some manufacturers are investing in other business forms to make extra revenue and meet targets. On Thursday, GM announced they will be accelerating their new fee-based digital features by 2026.
Netflix’s subscription business model was an ingenious discovery. Today, all forms of art including music and books have subscription services. Tesla jumped in on it, and it seems every other auto manufacturer is hungry for a subscription paycheck.
In 2021, Toyota tried to include subscription services into their business model, placing a charge on remote starting but failed after a backlash from consumers. BMW also tried including a yearly subscription for Andriod Auto, Apple Car services, and basic car features.
According to a top GM executive, the company is looking to accelerate its non-vehicle revenue and introduce dozens of new fee-based digital features, Reuters reported.
In an investor conference, Steve Carlisle, GM North America president, said that the automaker had added some 50 value-added products and services available over the next 36 to 48 months.
According to Carlisle, the manufacturer’s OnStar unit that features Insurance and concierge services to drivers costs $32/month per client. The company expects their Super Cruiser driver assist feature to maximize on that.
During an investor meeting in January, Ford CEO Jim Farley also mentioned that subscription services can add $20 billion to their revenue by 2030. While he pointed out they won’t charge a fee for heated seats, it was clear they are planning to include subscription services for ‘useful data.’
Carlisle added that GM is considering flexible pricing for their data-oriented software products, from monthly to lifetime subscriptions.
General Motors’ introduction of data-driven software is part of a plan announced in 2021 to boost their revenue to $280 billion by 2030. With time, automotive consumers will have to cave into auto subscription services as the shift to EVs intensifies.
In 2021, Toyota tried to include subscription services into their business model, placing a charge on remote starting but failed after a backlash from consumers. BMW also tried including a yearly subscription for Andriod Auto, Apple Car services, and basic car features.
According to a top GM executive, the company is looking to accelerate its non-vehicle revenue and introduce dozens of new fee-based digital features, Reuters reported.
In an investor conference, Steve Carlisle, GM North America president, said that the automaker had added some 50 value-added products and services available over the next 36 to 48 months.
According to Carlisle, the manufacturer’s OnStar unit that features Insurance and concierge services to drivers costs $32/month per client. The company expects their Super Cruiser driver assist feature to maximize on that.
During an investor meeting in January, Ford CEO Jim Farley also mentioned that subscription services can add $20 billion to their revenue by 2030. While he pointed out they won’t charge a fee for heated seats, it was clear they are planning to include subscription services for ‘useful data.’
Carlisle added that GM is considering flexible pricing for their data-oriented software products, from monthly to lifetime subscriptions.
General Motors’ introduction of data-driven software is part of a plan announced in 2021 to boost their revenue to $280 billion by 2030. With time, automotive consumers will have to cave into auto subscription services as the shift to EVs intensifies.
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