Today, automakers are offering a wide range of paid subscription services to unlock various features and functionalities within their vehicles. This means car buyers can now also decide on which connected services they want to add to their vehicles, and this shift has significant implications for fleets and individual car owners alike.
Subscription Offerings Today
These subscriptions cover everything from entertainment options to enhanced navigation and hands-free driving capabilities. This trend is on top of the regular monthly car payments that buyers are already accustomed to.
Tesla offers its “full self-driving” beta software at 15,000 USD (~23,000 AUD) or a 200 USD (~300 AUD) per month subscription. In Australia, however, this is an upfront cost of 5,100 AUD.
Premium features are being bundled into subscription packages. Mercedes’ Me Connect, for instance, offers a 150 USD (~230 AUD) annual subscription bundle that includes services ranging from live weather and traffic updates to software for finding and reserving parking spaces. In Australia, Digital Extras can be purchased and renewed from the Mercedes Me app.
In the UK, US, and in Canada, Ford has rolled out BlueCruise, a hands-free highway driving technology. Buyers can choose to include its cost in their financing for three years, amounting to 2,100 USD (~3,300 AUD. Alternatively, they can opt for a 90-day free trial and then activate it later for 800 USD (~1,500 AUD) annually or 75 USD (~112 AUD) per month.
General Motors offers its Super Cruise highway hands-free system at an initial cost of 2,200 USD ( ~3400 AUD) for Chevrolet and GMC vehicles or 2,500 USD (~3900) for Cadillacs, followed by a 25 USD (~37 AUD) monthly or 250 USD (~390 AUD) annual subscription fee.
Impact on Fleets
The subscription model can have wide-ranging effects on operational efficiency, cost management, and the overall driving experience for employees or drivers that fleet operators and managers may need to consider.
Customisation and Cost Control. The ability to choose which connected services to add allows fleet managers to customise their vehicles to meet specific operational needs. Instead of investing in a one-size-fits-all approach, fleet operators can select features that enhance productivity, safety, and efficiency while avoiding unnecessary expenses. For example, opting for hands-free driving technology can improve driver safety during long highway trips.
Financial Planning. The subscription-based model introduces flexibility in budgeting for fleet managers. They can allocate costs strategically by subscribing to certain features only when needed. This can help align costs with actual usage, helping to optimise the budget.
Employee Satisfaction and Productivity. Features such as enhanced navigation and entertainment options can significantly impact the satisfaction and productivity of drivers. Fleet managers can provide a more comfortable and connected experience for their drivers, making long hours on the road more enjoyable and efficient. This, in turn, can improve driver retention and job satisfaction.
Trial Periods. Fleet managers can leverage the trend of offering free trials for certain services to evaluate their benefits before committing to long-term subscriptions. It allows fleet operators to make informed decisions based on their specific operational needs.
Avoiding Subscription Overkill. Fleet managers should be cautious about overloading their vehicles with subscriptions. Focus should be shifted on essential features that directly impact safety, efficiency, and the overall fleet objectives.
Budget Constraints. Fleet operators, like individual car buyers, have budget constraints. They need to balance the desire for advanced connected services with the need to control costs. The challenge is to provide essential features that add value to the fleet without exceeding budget limitations.
Futureproofing. As the automotive industry shifts toward connected tech platforms, fleet managers need to consider how these changes will affect their operations in the long term. Integrating vehicles with advanced features and software can improve efficiency and data-driven decision-making, but it also requires a long-term strategy for technology adoption and management.
Car feature subscriptions present both opportunities and challenges for fleet operators and managers. Carefully evaluating and selecting subscriptions that align with their operational goals, budget constraints, and employee needs can help fleet managers leverage these offerings to enhance their overall fleet management strategy while ensuring cost-effective and efficient operations.
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