Remember when buying a car meant paying once, grabbing the keys, and driving off into the sunset?
That era may be fading fast. Automakers are quietly transforming the way drivers pay for their vehicles – and your next car could come with a growing list of monthly charges long after you’ve left
General Motors is leading the charge, betting that subscriptions for features like navigation, safety systems, and hands-free driving will soon become a major profit engine – potentially generating billions of dollars a year and, in some cases, even more than selling the cars themselves.
GM says its software arm keeps about 70 cents of every dollar it makes – a staggering level of profitability in an industry where selling a car typically brings in just 4 to 10 cents on the dollar.
Instead of paying upfront for everything, drivers now get certain features included for a limited time – often just a few years – before being asked to pay monthly or annually to keep them.
In its latest earnings update on Tuesday, GM said it expects to generate $3.1 billion from digital subscriptions this year.
‘We think there’s a growth opportunity there with very attractive margins,’ CEO Mary Barra told investors.
GM already has around 13 million subscribers paying for various in-car services, and that number is expected to climb rapidly as more vehicles come equipped with built-in technology.
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