New Jersey Introduces Bill to Ban In-Car Subscriptions

As software and connectivity in new vehicles has become more sophisticated, automakers have been able to lock and unlock some features via over-the-air updates, which can be offered on a subscription basis.

A prime example is driver assistance features. We have already seen that Cadillac has introduced a monthly subscription to Super Cruise, which requires a subscription after the free trial period. In some markets, automakers are beginning to offer features like heated seats and automatic headlights on a monthly subscription basis.

Not everyone is enthusiastic about adopting such business practices. In September, two members of the New Jersey Assembly, Paul Moriarty and Joe Danielsen, introduced a bill (No. 4519) aimed at making it illegal for automakers and dealers to sell subscriptions for features that use hardware already installed in the vehicle at the time of purchase. Filed.

However, the bill retains a caveat for features that require an ongoing fee to the automaker, dealer, or third-party service provider. That is, features that are constantly being improved, such as Cadillac's Super Cruise, could remain as subscriptions that could be upgraded with new features or expanded map coverage. The same is also true for features that deliver content, such as streaming.

Also, since the bill is subscription-specific, even if passed, automakers could charge a one-time fee for features that can be unlocked on demand. This could actually be advantageous to buyers, as they could decide later whether they really need the feature instead of paying an additional fee at the time of purchase.

Hyundai just announced last week that its next-generation cars will offer so-called feature-on-demand products. According to Hyundai, owners will be able to upgrade the performance and features of their cars wirelessly, but the company did not say whether this will be a one-time fee or a subscription.