The car maker joins a growing trend that’s not very consumer friendly).
Normally, when you buy a big-ticket item, that item simply does what it’s supposed to do, You don’t have to pay extra to take a nap on your new mattress or pay a monthly fee for your TV to hook up to your streaming device.
Subscriptions, however, have become a really attractive revenue source for companies in spaces where they were never a thing. That makes sense because who wants to make a one-time sale when you can tack on a recurring charge that people month after month (or maybe in a set amount to “unlock” some sort of feature that used to be included.
Subscription plans are the new normal with airlines offering discounted flights or even an all-you-can-fly pass. Automakers are now getting in on the action with car subscriptions that will have you paying extra for additional features. It’s a trend of charging for what is usually included in the cost of the car is being picked up more and more by different auto manufacturers.
Last summer, BMW (BMWYY) launched a subscription in which one can pay $18 a month to have heated seats. Certain Nissan (NSANF) cars come with a “Select” package that, while free for a few years after purchase, later changes to $8 a month for things like remote door locking and car maintenance reports.
Tesla (TSLA) – Get Free Report also has multiple subscriptions — from video streaming and satellite views for $9.99 a month to autopilot capabilities for $199 a month.
Unlocking That Horsepower (For A Price)
Mercedes (DDAIF) just launched its own subscription service specifically dedicated to increasing horsepower — $1,200 a year will allow one to reduce the car’s acceleration time from 0-60 mph by about 0.8 to 0.9 seconds.
The subscription, which goes under the name “Acceleration Increase,” will be available for the Mercedes-EQ EQE and Mercedes-EQ EQS electric cars. Retail prices for these car models start at a respective $84,900 and $104,400.
“Fine tuning of the electric motors increases the maximum motor output (kW) of your Mercedes-EQ by 20 to 24%, depending on the original output from factory,” Mercedes said in the promotional page for the new service. “The torque is also increased, enabling your vehicle to accelerate noticeably faster and more powerfully.”
The page announcing the subscription also says that it will be available “soon” but has not yet provided an exact availability date.
This is not something that one will have to go to the dealership to install – the cars already come equipped with this acceleration features but Mercedes locks them for those who have not paid the $8 a month.
The Economics Of The Car Service Subscription
Mercedes subscription is clearly designed for hard-core driving fans to whom a difference of 0.8 seconds matters.
As few city and suburban environments allow one to safely go from 0 to 60 mph in such a short period, only those who regularly get out to the tracks will be able to truly take advantage of such a feature.
But while this might be worth it to car aficionados, many such subscriptions are little other than a source of annoyance over having to pay a little here and a little there for features that they feel should already be included in the price of the car.
After the uproar over its heated seats feature, BMW backtracked with a statement saying that they are free on “90% of the BMWs sold in the USA” while it “does not expect factory option purchase levels to change significantly going forward.”
A survey by car sales platform Cox Automotive conducted last summer found that only 25% of drivers asked said they wouldn’t mind paying for additional features on the next new car they buy. The other 75% “expect most features and services to be included in the upfront sales price.”
“Who knows maybe Mercedes proves doubters wrong and EQ customers gladly pay up for the extra performance but these sorts of subscription services just feel like gross and dishonest ways for brands to squeeze even more money out of their customers,” Nico DeMattia wrote for The Drive.