Automakers are turning to software to unlock functionality long after a new vehicle has been driven off the dealership lot.
Premium brands from Audi to Tesla are tapping into a rich — and recurring — revenue model. They are building cars and light trucks with the necessary hardware and allowing customers to add features post-sale for a one-time or monthly fee.
Auto industry executives argue the subscription model offers consumers peace of mind and a lower entry point to use or acquire expensive technology and features.
Rather than paying $12,000 upfront for Tesla’s Full Self-Driving capability software suite, customers can access the technology for a more affordable $199 a month.
Porsche last year introduced a Functions On Demand feature. Porsche Taycan customers can buy enhanced adaptive cruise control and range optimization features for a monthly or one-time fee.
But with mushrooming bills for streaming services, consumers may be growing weary of the subscription model. Having to pay for vehicle features can prove pricey over the decade-plus lifetime of a vehicle.
The ability to add a feature post-purchase can help alleviate buyer remorse, Porsche Cars North America CEO Kjell Gruner told journalists via videoconference Thursday.
It’s a benefit “when you wake up three months after you bought the car and say, ‘Hey, I want to have this or that feature,’ ” Gruner said. “We think it adds more convenience over time.”
Adding features on demand can also future-proof a vehicle and lift resale values.
Functions on Demand, for instance, allows buyers of pre-owned Porsches to exercise an option to personalize the vehicle, the automaker said.
Perhaps “the first buyer made an error when they configured the car,” Gruner added. “Or the second owner, after three years, might have a different idea of what he or she wants to have in their car.”