Software plays a very important role in today’s automotive landscape, as it is used to govern the numerous features found in modern cars. This development has resulted in customers benefitting from an improved user experience, but automakers also stand to gain as well.
In recent times, we’ve seen automakers introduce subscription models that require customers to pay a fee to unlock certain features that are already built into the cars that they purchased. For example, Tesla launched its Full Self-Driving subscription package in July for customers that want additional features on top of the standard Autopilot system.
Many moons ago, BMW rolled out a subscription service for Apple CarPlay use on its models, although this was dropped soon after. Even the new Mercedes-Benz EQS is not devoid of subscription features, as customers in Germany will reportedly need to pay a fee to unlock the full capabilities of the electric vehicle’s rear-wheel steering.
The introduction of subscription features serves to provide automakers with an additional source of revenue beyond just aftersales when a customer purchases a car. This especially crucial for EVs, which are significantly cheaper to maintain compared to internal combustion engine cars. This trend of “add-on options” isn’t specific to the automotive industry either, as device makers also employ a similar strategy; look at the Apple One subscription plan offered to Apple customers.
With this trend looking set to be more widespread in the future, how are automakers in Malaysia approaching it and would customers be receptive to subscription features? These questions were posed to Mercedes-Benz Malaysia (MBM) during a recent media roundtable attended by Sagree Sardien, president and CEO of MBM as well as Michael Jopp, VP of sales and marketing at MBM.
“I think you could say that about anywhere in the world, right? Whether customers would be receptive to these digital service offerings that we have. Therefore, we have to start off on a small scale where we start offering this and what makes sense, trial it, test it, look at the data,” said Sardien.
“If, in the end, we can show the customer the value and the benefits, I’m quite sure that they will adopt this and they will continue to do it. In the beginning, we will start it as part of our digital journey, where we offer these digital services plus products, and we will select what makes sense for the Malaysian market,” she added.
“We would have to do some research on what practical features we believe, at the end of the day, Malaysian customers would be interested in, bring those first in, trial them, test them, and make a decision on how we want to move forward,” Sardien explained further.
While no timeline was given on when we can expect subscription features to be present in Malaysia, Jopp noted that, “at this moment, we can certainly also confirm that these kinds of special features will be offered in Malaysia at one point in time.”
So, how do you feel about subscription features? Would you be willing to pay extra to unlock certain functions in your car? There are pros and cons to this, with the latter being the obvious fact that you have to fork out extra monthly or even annually to use certain car features.
However, if you don’t plan to use particular features, there is an avenue to save some money. Additionally, the practice also has other cost benefits via a more streamlined production process. Having software-locked features means there are less mechanical variations on the vehicles, so they can be assembled more efficiently. For example, Mercedes-Benz no longer needs to manufacture two different versions of the EQS, say one with rear-wheel steering and one without.
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