Can Automakers Really Cash In on Connectivity and Subscription Schemes?

A little over a decade ago, it seemed like everyone I knew was abandoning cable packages for online streaming services. They were cheaper, on-demand, and offered more choices with fewer advertisements. But as the years progressed, companies stopped selling their media to a handful of online video platforms and started building their own. Programming became more transient and isolated, forcing consumers to buy into additional subscription services. We’ve since hit a point where the overall consumer experience has diminished and grown more expensive, despite the steady influx of competition.

While automakers have been dabbling with subscription services of their own, their earliest attempts turned out to be such overwhelmingly bad deals that the public refused to play along. But they’re not giving up that easily. Industry players have been trying to figure out ways to charge customers indefinitely for years and are starting to settle upon subscription packages that can unlock hardware that’s already been installed into the vehicle or add software that can be downloaded via over-the-air (OTA) updates. Love or hate it, vehicular connectivity has opened up the door for new sources of revenue and businesses everywhere are eager to take advantage — with most companies projecting exceptionally healthy profits for the years ahead.

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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.

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GM's Cruise Sees Another Billion-dollar Investment

General Motors’ self-driving vehicle unit, Cruise, has attracted new investors and an equity infusion of $1.15 billion as it continues work on its commercial fleet of autonomous taxis. The new investment, which effectively brings the operation’s valuation to $19 billion, is primarily fronted by Baltimore-based asset management company T. Rowe Price Associates Inc. and existing partners like SoftBank’s Vision Fund and Honda Motor Co.

“Developing and deploying self-driving vehicles at massive scale is the engineering challenge of our generation,” said Cruise CEO Dan Ammann. “Having deep resources to draw on as we pursue our mission is a critical competitive advantage.”

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What Does Ford Look Like As a Mobility Company?

These days, every automaker is in the midst of a metamorphosis, eager to emerge from their chrysalis as a “mobility company.” Even brands that don’t seem bent on completely revolutionizing their business model now use the term in reference to themselves.

Ford, which has positioned itself as a mobility company ever since Mark Fields was steering the ship, is among those pushing the narrative the strongest. Fields may have been fired for having a lofty, tech-focused vision that couldn’t charm investors, but much of it carried over to Jim Hackett’s tenure as CEO. Ford desperately wants to be seen as a cutting-edge nameplate.

However, the assumption among industry experts is that it’s lagging behind General Motors in terms of autonomous driving, electrification, and the ability to tap into alternative revenue streams. We sometimes wonder how accurate those assumptions are.

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More Evidence That Self-driving Cars Are on a Road to Nowhere

We’ve been critical that self-driving systems are, ahem, “oversold” by automakers and tech firms hoping to boost their stock valuations. That doesn’t mean autonomous vehicles won’t happen, just that the timeline is probably a lot longer than the public has been led to believe. Still, it makes sense to pursue AVs. The first company to achieve legitimate self-driving will blow the hinges off a door leading to an array of new business opportunities.

General Motors, long considered a frontrunner in the autonomous race, is apparently in desperate need of a second wind. Its Cruise self-driving unit is said to be woefully behind in its attempt to bring an autonomous vehicle to the commercial market by 2019. Some GM staffers have confessed that the current system isn’t even capable of identifying whether objects are in motion or not — which seems like an important distinction for a computer-controlled automobile to be able to make.

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Apple Rebuilding Maps App, Hopes to Outperform Google

Apple Maps has been a lackluster tool for navigation since its launch. Of course, you probably don’t know this because you’re statistically more likely to back out of the driveway using Google Maps or Waze. That’s because the latter programs seem to work as intended. The same cannot be said of the former.

While Apple can get you down a major highway without incident, it frequently falls apart when you start asking it to make sense of a complex, overlapping network of roads or sparsely traveled rural area. Meanwhile, Google has already mapped the same areas twice and taken photos of every blade of grass within 100 square miles.

Upon launch, Apple Maps was plagued with issues. Areas were left blank, locations were misnamed, landmarks were misplaced. Had it come out a decade earlier, it’d have been a technological marvel. But with competent competition readily available, the iOS-based navigation system was (and remains) unacceptable. So Apple is giving it a complete overhaul.

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BMW Rep: Government May Never Allow for Autonomous Cars, Computerized Life and Death Decisions

BMW’s past promises include a pledge to help keep drivers driving in the brave new world of autonomous vehicles. However, it hasn’t entirely sworn off self-driving technology. The company finds itself in a tricky spot, as it’s seen as both a luxury automaker and a performance brand. But it can’t claim to be “The Ultimate Driving Machine” if it doesn’t allow customers to drive.

Automakers and tech firms pushed relentlessly for autonomous driving, making claims that a self-driving nirvana was just around the corner. But current technology proved less than perfect in practice and modern autonomous vehicles require constant human involvement to operate safely, just like any normal car. Despite making strides, the industry seems torn on how to appease everyone.

The government is even more in the dark. While lawmakers initially agreed with industry rhetoric (that autonomy will save lives and usher in a new era of mobility), recent events sparked skepticism. There aren’t many new regulations appearing in the United States, but there also isn’t any clear legislation to help decide who’s held liable when the cars malfunction. A lot of what if questions remain unanswered.

BMW thinks this will be the main reason why autonomous cars fail.

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Japan's SoftBank Dumps Cash Into America's Autonomous Vehicles, Sets GM Deadline for 2019

Several months after procuring a large ownership stake in Uber, SoftBank has placed $2.5 billion into General Motors’ self-driving program. The automaker intends to begin deploying autonomous vehicles next year and CEO Mary Barra says her company will invest $1.1 billion of its own funds into the effort to ensure the timeline is adhered to.

Thanks to the hefty investment from SoftBank’s Vision Fund, the Japanese holding company now owns roughly 20 percent of General Motors’ tech subsidiary, known as Cruise Automation. While tech firms and automakers have been driving hard to surpass each other in terms of autonomous development for years, GM currently appears to have the most riding on the hardware.

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QOTD: What Tech Makes You a Lazier Driver?

One of the criticisms of all the various pieces of technology that serve as driving aids is this: They make it too easy for drivers to fall into bad and lazy habits.

I thought of this while making a lane change near my Chicago home the other day. The test car I was in had blind spot monitoring, and I made the change without turning my head, and with barely a peep at the mirrors.

It was a harmless maneuver, as no one was near me. The system worked. But I chided myself – I’d let technology make me lazy.

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Marchionne & Co.: Style Will Be Essential in the Vanilla Future We've All Been Promised

The future is going to be absolutely terrible. Everything is going to be so sterile and automated that humans won’t have anything to do between mealtimes but eagerly anticipate their own death.

At least, that’s the picture being painted by experts. We’re probably further out from autonomous cars, world peace, and robotic butlers than society’s “thinkfluencers” want to admit, but be that as it may, the times are changing and some of this is coming down the pipe.

Automakers are all about the “nextification” of the industry; always promising technological marvels at an accelerated rate. However, Fiat Chrysler Automobiles CEO Sergio Marchionne now claims most visions of the future lack an essential element — any semblance of style.

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GM to Patent Temporary Digital Key?

A standard part of the dealership test drive experience involves the salesperson grabbing the key to the car in question out of a lockbox, then accompanying the customer on the drive. A new patent filing suggests General Motors may be looking for a way to give customers access to the car without requiring a salesperson to dig through a box of keys.

GM appears to be working on a patent that would allow customers to have a temporary digital key granted to them in order to gain access to a vehicle they want to test drive.

The system would work like this: Interested customer applies for the key, the dealer verifies the buyer’s interest and identity, dealer approves the test drive and monitors it. If the customer doesn’t want to buy the car, the dealer can revoke the digital key authentication, and it can also do the same to a prior key holder if the vehicle is used and someone other than the first title holder buys it.

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Automakers Continue to Prioritize Technology Trade Shows and China

Automakers continue to snub mainstream automotive trade shows for CES, which is swiftly becoming one. Compared to Las Vegas’ Consumer Electronics Show, Asia’s nascent tech expo is exceptionally small but that hasn’t prevented automakers from taking an interest. Only in its third year, CES Asia hosted General Motors, BMW, Mercedes-Benz, Honda, Hyundai, and Volvo.

In fact, several of the event’s large rooms housed nothing but products stemming from automotive manufacturers — underlining how automakers need to be perceived in 2017. China’s massive population is churning out heaps of new drivers everyday, making it the primary growth market for many global brands. Combine that with the country’s aggressive push into green cars — with a public that is perpetually hungry for tech-laden vehicles — and CES Asia attendance was compulsory for many.

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LeMons Crash Proves Why Safety Should Never Be Cheap

In my life, I’ve officiated exactly two LeMons races thanks to the good graces of Murilee Martin. At those races, I’ve watched tech inspectors go over seats, belts and harnesses with more scrutiny than border guards in Israel. To be sure, it’s astounding to me how much safety needs to be welded, worked and crammed into a “junker” from the outside — most people never see that. But even I wondered sometimes why tech was so hard to pass.

There are myriad things that can go wrong on a racetrack. However, there are only a few things that can save lives when those things go wrong. For those lifesaving devices, there’s no substitute or corner-cutting, and there are reasons why good teams spend more on a cage and brakes than they ever spend on an engine.

Case in point: Coming up on a blind crest and running face-first into the rear of a stalled car and everyone is OK after.

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Chipmakers Think In-car Tech Will Be The Next IPhone

Maxed out of selling you a new phone every 15 minutes, chipmakers such as Nvidia and Intel are looking to break into the automotive business as the next new lucrative frontier for technology, Reuters reported.

Established automotive suppliers such as Infineon, Renesas and NXP may be figurative feet in the doors for other tech makers to exploit a growing car boom and tech cycle.

“A decade ago, autos was not sexy. Now it is,” Reinhard Ploss, chief executive of Infineon said, according to Reuters.

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Who Reads The Instruction Manual? (Update: No One)

J.D. Power and Associates on Tuesday released its study of in-car technology that showed many new car buyers either don’t use features available on their car or aren’t aware they exist.

According to the study, at least 20 percent of buyers haven’t used 16 of 33 features targeted by the study, including in-vehicle concierge services such as OnStar (43 percent); mobile Internet connectivity (38 percent); automatic parking aids (35 percent); heads-up displays (33 percent); and apps (32 percent).

Owners said their smartphones probably do all those things better, and who has time to learn systems when you have to text and drive anyway?

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  • Theflyersfan OK, I'm going to stretch the words "positive change" to the breaking point here, but there might be some positive change going on with the beaver grille here. This picture was at Car and Driver. You'll notice that the grille now dives into a larger lower air intake instead of really standing out in a sea of plastic. In darker colors like this blue, it somewhat conceals the absolute obscene amount of real estate this unneeded monstrosity of a failed styling attempt takes up. The Euro front plate might be hiding some sins as well. You be the judge.
  • Theflyersfan I know given the body style they'll sell dozens, but for those of us who grew up wanting a nice Prelude Si with 4WS but our student budgets said no way, it'd be interesting to see if Honda can persuade GenX-ers to open their wallets for one. Civic Type-R powertrain in a coupe body style? Mild hybrid if they have to? The holy grail will still be if Honda gives the ultimate middle finger towards all things EV and hybrid, hides a few engineers in the basement away from spy cameras and leaks, comes up with a limited run of 9,000 rpm engines and gives us the last gasp of the S2000 once again. A send off to remind us of when once they screamed before everything sounds like a whirring appliance.
  • Jeff Nice concept car. One can only dream.
  • Funky D The problem is not exclusively the cost of the vehicle. The problem is that there are too few use cases for BEVs that couldn't be done by a plug-in hybrid, with the latter having the ability to do long-range trips without requiring lengthy recharging and being better able to function in really cold climates.In our particular case, a plug-in hybrid would run in all electric mode for the vast majority of the miles we would drive on a regular basis. It would also charge faster and the battery replacement should be less expensive than its BEV counterpart.So the answer for me is a polite, but firm NO.
  • 3SpeedAutomatic 2012 Ford Escape V6 FWD at 147k miles:Just went thru a heavy maintenance cycle: full brake job with rotors and drums, replace top & bottom radiator hoses, radiator flush, transmission flush, replace valve cover gaskets (still leaks oil, but not as bad as before), & fan belt. Also, #4 fuel injector locked up. About $4.5k spread over 19 months. Sole means of transportation, so don't mind spending the money for reliability. Was going to replace prior to the above maintenance cycle, but COVID screwed up the market ( $4k markup over sticker including $400 for nitrogen in the tires), so bit the bullet. Now serious about replacing, but waiting for used and/or new car prices to fall a bit more. Have my eye on a particular SUV. Last I checked, had a $2.5k discount with great interest rate (better than my CU) for financing. Will keep on driving Escape as long as A/C works. 🚗🚗🚗