Driving Dystopia: Stellantis Is Becoming a Software Company Like Everyone Else

Matt Posky
by Matt Posky
driving dystopia stellantis is becoming a software company like everyone else

On Tuesday, Stellantis announced a plan to cultivate €20 billion ($23 billion USD) per year by 2030 via “software-enabled product offerings and subscriptions.” However, the automaker will first need to increase the number of connected vehicles it has sold from 12 million (today) to 34 million by the specified date.

This is something we’ve seen most major manufacturers explore, with some brands firmly committing themselves to monetizing vehicular connectivity through over-the-air (OTA) updates, data mining, and subscription services. Though much of this looks decidedly unappetizing, often representing a clever way for companies to repeatedly charge customers for equipment that’s already been installed.

“Our electrification and software strategies will support the shift to become a sustainable mobility tech company to lead the pack, leveraging the associated business growth with over-the-air features and services, and delivering the best experience to our customers,” said Carlos Tavares, Stellantis CEO. “With the three all-new AI-powered technology platforms to arrive in 2024, deployed across the four STLA vehicle platforms, we will leverage the speed and agility associated with the de-coupling of hardware and software cycles.”

Starting in 2024, Stellantis said it would also deploy three new technological platforms dependent upon artificial intelligence named STLA Brain, STLA SmartCockpit, and STLA AutoDrive. These will be launched with help from Alphabet/Google’s Waymo, Hon Hai Precision Industry Co’s Foxconn, and BMW.

According to the manufacturer, most services will be highly specific to individual brands. For example, Dodge will focus on OTA updates that prioritize enhanced performance — delivering more horsepower while maintaining emissions compliance (more on that later). Meanwhile, Jeep will offer software updates that help with off-road scenarios as Alfa Romeo focuses on delivering sharper handling and Ram focuses on increasing payload capacities.

That’s the pitch anyway. But it sounds to me that these vehicles will come from the factory less capable than they could have been with the option for customers to unlock their full potential through OTAs and subscriptions.

Due to its ties with Fiat Chrysler Automobiles (FCA), Stellantis is often viewed as a technological laggard. As FCA was hoping to be bought for its iconic brands (namely Jeep), the company hadn’t bothered to spend the kind of money on electrification and data monetization as the bulk of its rivals. While your author doesn’t see a real downside to an automaker perfecting older tech to give customers a solid ROI (it’s been working pretty well for Toyota), Stellantis obviously doesn’t want to be viewed as behind the times.

As more businesses shift toward the dreaded goods-as-a-service model, we’re finding most companies aren’t terribly particular about what they’re charging us for. They just seem excited to have another opportunity to tack on another reoccurring payment. Provided that you cannot ever have direct control or legitimate ownership of the end product, someone is more than willing to sell it to you.

In the realm of video games, similar trends opened up the door to digital downloads that allowed shoppers to put entire libraries of games (modern and vintage) onto hard drives or into the cloud. Customers further benefited from online updates that added content and fixed bugs. But it wasn’t long before these services became a convenient way to release unfinished products and charge users for the kind of content that would have previously been free. Gamers soon found themselves signing 40-page service agreements just to have the privilege of playing the game they already bought, only to be confronted with relentless microtransactions that used gambling elements to deliver companies loftier profit margins. Many modern games cannot even be played unless the user has logged into the internet, maximizing the associated data services potential.

As a direct result, the core community became jaded, fractured, and distrustful of larger publishers. Mimicking the film industry, establishment gaming journalists dependent upon access continued giving favorable reviews to products the broader public had dubbed shoddy, incomplete, or tainted by corporate influence. But the criticism hasn’t stopped there. Gamers are now making claims that publishers have spent so much time copying each other’s business tactics that the entire industry has stagnated creatively and is no longer capable of evolving gameplay.

While the comparison to automakers isn’t one-for-one, manufacturers are indeed chasing down similar trends as they all try to rebrand themselves as software-slinging technology firms. This will likely result in wider margins and whole new revenue streams for some. But we’re likewise inclined to believe that any company running with the concept for too long will become a pariah. This is acceptable in the gaming industry because the core product is relatively affordable and there’s still plenty of room for growth. If your business decisions alienate legacy players, there’s a chance you can still scoop up younger players in another part of the world for a net win. But one wonders how it would translate to the automotive sector where the initial product represents the second-largest household purchase and market saturation is already exceptionally high.

Let’s consider General Motors tracking of customer behavior in their own cars to help determine how best to advertise. How about Ford’s current data-focused fleet analytics software? Mercedes’ decision to start charging customers for equipment that’s already inside the vehicle? BMW attempting to charge subscription fees for things most companies considered standard equipment? Tesla’s remote monitoring of driving behavior to determine who is worthy of the latest over-the-air updates? What about the fact that the government has already begun using vehicular connectivity to spy on people in real time?

Surely one of those has to register as a bridge not worth crossing, despite the fact that we’ve already made it to the other side.

We’ve even seen environmental groups float OTA updates as a way to remotely neuter cars as emission compliance rules change. Worried that the V8 you purchased in 2024 wasn’t going to be regulations friendly in 2028? In the future, you won’t have to because the manufacturer will be able to change the vehicle’s programming on the fly.

Mr. Tavares said that all of Stellantis’ upcoming connectivity features will result in the automaker becoming more like a tech company than a car firm and that they would ultimately result in longer-lasting vehicles with higher resale values. This again clashes with reality as Subaru, Toyota, Honda, and Dodge tend to have the strongest resale value (among mass-market brands) and none of them are known for putting the latest tech into their core lineup.

I’m of the mind that the Stellantis software presentation was more about goosing technology-obsessed investors than showcasing future technologies. Prospective services were lumped into “Five Key Pillars” representing more or less what every other manufacturer hopes to achieve using connectivity as a springboard. They included Services and Subscriptions, Features On Demand, Data as a Service and Fleet Services, Vehicle Pricing and Resale Value, and finally Conquests, Service Retention and Cross-Selling. Discussions pertaining to the STLA programs were less specific, highlighting general capabilities than any specific tasks they might be utilized for.

From Stellantis:

STLA Brain is fully OTA capable, with 30 modules addressed, versus 10 today, making it highly flexible. It is a service-oriented architecture fully integrated with the cloud that connects electronic control units within the vehicle with the vehicle’s central high performing computer (HPC) via a high-speed data bus. It breaks today’s bond between hardware and software generations, enabling software developers to create and update features and services quickly without waiting for a new hardware launch. These OTA updates dramatically reduce costs for both the customers and Stellantis, simplify maintenance for the user and sustain vehicle residual values.

STLA SmartCockpit, built on top of STLA Brain, will seamlessly integrate with the digital lives of vehicle occupants to create a customizable third living space. Studies show that customers spend an average of four years of their lives in their vehicles and this is only increasing.

STLA SmartCockpit, powered by the Mobile Drive joint venture between Stellantis and Foxconn, delivers AI-based applications such as navigation, voice assistance, e-commerce marketplace and payment services.

STLA AutoDrive, developed in partnership with BMW, will offer Level 2, Level 2+ and Level 3 autonomous driving capabilities and will be continuously upgraded through OTA updates.

Frankly, any criticisms one might make against Stellantis could be leveraged against most other legacy manufacturers. The company hardly exists in a vacuum and is debatably behind in some of the tech that’s becoming commonplace elsewhere. While much of that is empty promises hoping to entice investors or the predatory monetization of customer data, there’s potential for genuinely useful features that might make driving more enjoyable. But the latter aspect doesn’t seem to be the priority when Stellantis ( and several other automakers) plan to launch an “insurance product” that sets premiums based on the data being amassed about how you drive. Scheduled to debut in 2022, the company intends to use captive lenders in Europe and North America before expanding the data-tracking insurance scheme to other parts of the world.

Considering the financial success of Facebook and other companies that have found new ways of harvesting and monetizing customer data, it’s hardly surprising to see the automotive industry trying to get a piece of the action. It’s just not evident that the market will be indefinitely tolerant of such invasive tactics. Right now, the public is largely unaware of how most of this works. But the more people that learn just how aggressive manufacturers have been in regard to data acquisition, the more tell me they will attempt to opt out of these services. Then again, if the industry manages to normalize this (perhaps with help from lobbyists, government regulators, technology partners, and insurance companies) it might not matter.

[Image: NeydtStock/Shutterstock]

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  • Ralahamy Ralahamy on Dec 10, 2021

    Encounters with AI Software agents , for example calling Apple to make an enqiury, seem more like encounters with AS - Artificial Stupidness.

  • Ralahamy Ralahamy on Dec 10, 2021

    Encounters with AI Software agents , for example calling Apple to make an enqiury, seem more like encounters with AS - Artificial Stupidness.

  • Wjtinfwb Didn't care for the E60 when introduced, compared to the previous generation. But up against some of BMW's latest offerings (new 7), it's a breath of fresh air. This car with a conventional 6-speed manual would be another 10-15k at least as it looks very well kept.
  • SPPPP Very nice shape, but I just never warmed to the E60 car like I did the earlier generations of the 5-series, or the contemporary 3-series.
  • Mike Beranek They're building a brand-new "vending machine" in Schaumburg, right on my way home from work. Maybe after they go belly up, I could buy it, build out living space on the top floor, and use the rest to display my awesome car collection (ha!)
  • VoGhost We're at the point where the stock price is no longer relevant; focus on how the debt is priced.
  • MaintenanceCosts Nice color combo. Worth noting that this is not a conventional automatic but an automated manual, which gets you all the roughness of a real manual with none of the fun. Also not sure why everyone loves the V10 so much; it sounds more UPS truck than performance car except at the extreme high end of the tach. Having said that the E60's looks have aged VERY well; the car looks nicer now than it did when it was new.
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