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VW: “we’ll sell you Level 4 autonomous driving for €7 an hour”

Volkswagen is hot for extras you can turn on with a subscription fee. Good idea?

Published: 05 May 2021

Volkswagen has told it’s eyeing a bold future. A future of cars crammed full of tech and features which the car’s owner / user / subscriber can turn on and off as and when they need them – but only pay for while the gadget is being used.

Any car connected to the internet has been able to receive over-the-air updates for some years now, allowing carmakers to update interfaces and tweak menus. 

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Several electric cars have seen their range increase simply from an automatic software update while the owner’s asleep. In their house, not in the car. 

But VW’s sales and marketing boss Klaus Zellmer sees this ability as the future for changing how you spec a brand-new car. Instead of ticking boxes of options (and VW having to tailor each car to spec in the factory, increasing costs) all VWs will be built with all the toys, and then you’ll simply lease them off the mothership when they make sense.

Basically, in same way you only rent scuba-diving gear when you’re on a holiday boat trip, rather than wearing it to work all year.

“Over the air allows access to a car’s operating system. The interesting aspect is functions on demand,” explains Klaus. 

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“If you happen to buy a car and weren’t convinced you needed an autonomous drive mode at the time, but then you decide you’d love to have it, we can switch it on, but we can then switch it off if the next owner of the car decides they don’t need it.

“Going forward, we see the future as accessing mobility when you need it, not committing to owning one car for several years.”

So, how much would this cost? “This is all based on profit and cost modelling,” says Zellmer. “If you take the example of Level 4 autonomous driving modes, the cost of installing that into a car is huge: a five-digit Euro figure.

“Who’s going to pay that? It’s not for the mass market. Now take the case that we install that and switch it on and off remotely. Our cost modelling says if we charge €7 an hour for Level 4 autonomous drive mode, this is a profitable business case.

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“Think about getting from London to say, Southampton on the train. How much is the train ticket? It’s certainly more than €7 an hour.”

For context, Southampton is a city on the English south coast about 80 miles (or a two-hour drive) from London. It’d cost about £50 for a standard-class train ticket for the 1hr 20min rail fare. 

Having eradicated public transport, Zellmer also reckons VW can concrete its already impressive second-hand values with this idea.

“If you can capitalise on pay-per-use in your business model, it is more cost-effective to fully load the car [with equipment] and switch it on or off according to a use case.

“That’s also interesting for the used market, because we can respond to changes in residual value by switching on functions to raise the used value.”

So, is this ‘like and subscribe to get the best tech’ plan a stroke of genius, or do you prefer speccing a car the old-fashioned way? VW may well be listening in on your comments…

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