Without aftermarket accessories, the vehicle you purchased long ago has the same features today as it did when it rolled off the assembly line. For all intents and purposes, everything about your car, from the powertrain to the infotainment system, is exactly the same as the day you drove it off the dealership. And you haven’t had to pay more for any of the features you use and enjoy most.
But that’s changing in the automotive industry as a whole, as features that were previously included in the price of the vehicle are now increasingly with paywalls. This change in the automotive industry is known as software-defined vehicle, or SDV for short.
An SDV is a car in which upgradeable software, rather than fixed hardware, determines what the vehicle can do. While SDV capability can unlock interesting, useful, and even fun features within the vehicle, it is ultimately an opportunity for automakers to generate recurring revenue streams from their customer base.
A 2026 IoT Analytics industry report found that 45% of auto manufacturers and suppliers are now classified the transition to SDV as its main strategic priority, ahead of both the development of electric vehicles and advanced driver assistance systems, which could be taken to the point of autonomous cars.
Why automakers love the subscription model
The average car on the road is older than ever
Under the traditional model, once a vehicle leaves the showroom with its new owner, an automaker’s opportunity to make additional money on that sale is greatly reduced. While distributors have the opportunity to earn downstream income through routine maintenance and serviceIt’s not so easy for the OEM.
At this point, automakers are essentially waiting for that same customer to return for another vehicle, but that takes longer than manufacturers would like. According to recent S&P Global Mobility Datathe average age of vehicles on US roads has risen to 12.8 yearsthe oldest ever recorded.
Individually, passenger cars are now on average 14.5 years old, while light trucks are on average 11.9 years old. In other words, the typical American vehicle on the road today was built during the Obama administration.
Meanwhile, automakers still cover the fixed costs of making the cars they sell. Everything from factories and tooling to engineering, R&D and marketing is covered by a single hardware transaction that occurs increasingly less frequently.
However, with an SDV, automakers can build the hardware for a certain feature into the vehicle on the assembly line and then use software to turn it on or off later, when the customer decides to pay for it. Faster acceleration settings, a powertrain change focused on off-roading, a driver assistance system or something as common as heated seats. All of these items are already in the vehicle. All of them included in the price of the vehicle. Until now.
If the average consumer won’t buy another vehicle for almost 13 years, waiting for the next sale is not a viable long-term business model for automakers. Recurring software revenue, whether monthly or yearly, allows an automaker to benefit financially throughout the ownership period. In fact, vehicle manufacturers will operate similarly to any other company operating on a subscription model.
What features already require a subscription?
Hands-free driving costs extra, regardless of brand
General Motors offers one of the clearest examples with Super Cruise, its hands-free on-road driving system. Super Cruise takes over steering, acceleration and braking on supported roads, relying on data from LiDAR maps, real-time GPS, cameras and radar sensors to keep the vehicle centered in its lane. The system now operates on more than 750,000 miles of supported highways in the U.S. and Canada and is available on select Cadillac, Chevrolet, GMC and Buick models.
Super Cruise is free for three years on eligible vehicles, after which drivers must purchase a plan to keep it active. GM currently prices a standalone Super Cruise add-on at just $25 a month, but the feature has become a cash cow for the automaker. GM expects to surpass 850,000 paid Super Cruise subscriptions by the end of 2026, and revenue from the feature is expected to increase. reach almost 400 million dollars in the year.
Like GM, Ford has its version of a hands-free highway driving system. BlueCruise controls steering, braking and acceleration on pre-qualified sections of divided highways called Hands-free blue zonesrepresenting more than 130,000 miles of North American highways, representing about 97% of controlled-access highways in the US and Canada.
BlueCruise is currently available on Explorer, Expedition, F-150 and Mustang Mach-E. New vehicle subscriptions come with a 90-day free trial, after which owners can pay $495 a year or $2,495 for a seven-year subscription. A monthly plan is also available for $49.99.
Mercedes-Benz sells a Acceleration increase update for its electric models EQE and EQS. The update increases power by up to 80 horsepower and improves zero-to-60 mph acceleration by up to a full second, all through an over-the-air update rather than any new hardware. Mercedes prices the upgrade at $600 a year on the EQE and $900 a year on the EQS, with a one-time lifetime purchase also available.
Meanwhile, Toyota offers two ways to start a vehicle remotely. One works through the Toyota app, allowing the owner to start the car from anywhere. The other is the standard remote key start, where pressing the lock button twice and holding it a third time starts the engine from a short distance.
For 2018-2022 models, both methods require an active subscription, although the fob method uses a short-range signal and does not require its own data connection. Subscription costs $8 per month or $80 per year.
Instead, Toyota’s new infotainment system, standard on most 2026 models includes Remote Connect in one package from $15 a month. At Toyota owner forumsCommunity consensus is largely negative towards the subscription model, with most advising against renewing anything other than Remote Connect, and only if you need to start your car regularly from a longer distance.
Questions to ask before your next test drive
With more features tied to a subscription rather than a one-time purchase, it’s helpful to ask some clarifying questions the next time you’re shopping for a new vehicle. Ask which features are included out of the box and which require a subscription. For the latter, ask how long the trial lasts and how much it costs once it expires.
Ask these technical questions along with all the standard questions you’ll want to ask when shopping for a new vehicle, including what the “retail” price is, how long the factory warranty lasts, and whether there are any additional rebates you may be eligible for.
