Some BMW owners will now have to pay US$18 per month for the added luxury of heated seats.
The company has launched a variety of subscription-based services in South Korea, Fortune reported. Other add-on features include US$10 per month for a heated steering wheel and a US$8 monthly charge for a driver safety feature. Each monthly feature is available at a discounted rate if drivers opt for a multi-year commitment.
Micro-transactions appear to be garnering popularity among auto manufacturers — although consumers have expressed opposition to the strategy. BMW says the pay-per-feature decision was made “because the majority of drivers opted against purchasing these options and it didn’t want to charge customers for things they didn’t use,” Fortune reported.
Critics say these features should be a permanent part of their car upon purchase. The vehicles already come with the hardware that controls these add-ons, so it seems unnecessary to use a software block to stop them from properly functioning without a monthly fee.
The company has attempted subscription based services in the past. In 2018, they introduced a US$80-per-year or $300 for 20 years charge for Apple CarPlay, however, the decision was quickly reversed following public uproar.
According to The Verge, BMW was unable to specify exactly when the subscriptions had been launched and in which countries, but the heated seat feature can be found in other countries including the U.K., Germany, New Zealand and South Africa. The automakers are yet to launch such a feature in its North American market and no plans have been announced. It is safe to assume that an introduction in Canada or the U.S. will not be well received.
A Cox Automotive survey revealed that 75 per cent of consumers are unwilling to pay an annual or monthly subscription fee for most items. A majority of the 217 consumers surveyed said they expect the features to be included in the upfront sale price, but some add-ons drew less pushback than others.
Safety features such as lane-keeping assistance and automatic emergency braking were well received. Eighty per cent of consumers surveyed showed willingness to pay up to US$35 monthly. Vehicle performance features like upgraded horsepower and torque, software updates and stolen vehicle tracking also got some positive response from consumers for extra charges. The survey showed that people were far less willing to pay extra for comfort features such as heated seats and wi-fi.
BMW is not a sole explorer of this new route. Volkswagen is also considering a subscription-based model. In an interview with Top Gear, VW Head of Sales and Marketing Klaus Zellmer defended the strategy.
“If you happen to buy a car and weren’t convinced you needed an autonomous drive mode at the time, but then you decide you’d love to have it, we can switch it on,” Zellmer said. “But we can then switch it off if the next owner of the car decides they don’t need it.”
Toyota appears to be playing with the same idea as they plan to charge drivers extra if they want to remote start their vehicle.
Although consumers are opposed to micro-transactions in the automotive world, manufacturers see an opportunity for a new source of revenue. Stellantis is reportedly expecting to make US$23 billion by 2030. Other manufacturers hoping to profit from the new model include Audi, Cadillac, Porsche and Tesla, which previously charged customers a flat fee to activate heated rear seats and a heated steering wheel.