While AM radio may remain in vehicles moving forward, as Ford just reversed its decision to nix the legacy band in future vehicles, another concept gives automakers the ability to charge consumers a subscription fee for what are called Features-on-Demand.
In-car subscriptions are already available for owners of Mercedes and Volkswagen but according to Cox Automotive, only 21% of new car shoppers are aware of the idea.
Automakers face slow-downs on the assembly line when custom features are added to stock vehicles. The thinking is if all options, such as heated steering wheels and seats, were included in vehicles it would keep the factories running efficiently and move more cars off the line. Then after the sale, consumers could subscribe to what options suit their needs.
“You might choose to pay $2.99 per month for that heated steering wheel because it’s cold where you live. The owner of an identical car in South Texas might never subscribe to it,” Kelley Blue Book’s Sean Tucker writes. “Features-on-Demand, as the concept is called, gives buyers new flexibility. They could even lead to lower up-front car prices.”
Cox Automotive’s survey of 2,000 in-market vehicle shoppers gauged the interest in Features-on-Demand. While the majority of those polled were not aware of the concept, once it was explained to them, only 41% would be interested in the option of adding a subscription plan to their new vehicle.
“Our initial research indicates that the transition to Features-on-Demand will be an uphill battle for many automakers,” Vanessa Ton, senior manager of market and customer research at Cox Automotive, told Kelley Blue Book. “In the market right now, there is low consumer awareness and some skepticism on the part of shoppers.”
According to the article, 65% of respondents said they might use it to try out new features without making a long-term commitment. Sixty-one percent liked the idea of upgrading or downgrading their vehicle as needed. And 54% liked the idea that subscriptions could give them access to the latest technology even years after they bought their new car. According to the report, streaming services, virtual assistants, and driver monitoring or self-driving capabilities have the highest appeal for long-term subscriptions.
What auto buyers don’t want is mandatory subscriptions. According to the survey, 69% said that if a car brand made subscriptions mandatory, they wouldn’t consider buying from that company.