Although it seems as though car companies are proclaiming the wonders of electric vehicles and making it sound as though their dealerships are chock full of them, with models to fit every need, that is far from being the case. On the one hand, most original equipment manufacturers don’t have all that many—Ford has two, three if you count a cargo vehicle aimed at contractors; GM has three, and during the first nine months of 2023 it sold 6,587 of them combined; it, too has a cargo vehicle, so if its 333 units are added, that still isn’t very many: if all of them were parked at the Mall of America’s parking lots about half the spaces would still be empty. On the other hand, these vehicles are pretty much pricy: according to Kelley Blue Book, the average transaction price for an electric vehicle—as in what people actually paid at a dealership—was $51,762: in 2022 the U.S. median income was $74,580; with 20% down and a five-year loan, buying that average EV would set someone back about $805 per month, or about 13% of household earnings (although the $74,580 is a pre-tax figure, so it would actually be a lower number).
What a real area of interest that OEMs have is something that isn’t widely talked about because were it to be it might be perceived as being rather greedy. What they want are recurring sources of revenues. That is, traditional OEMs that sell through dealerships (those that don’t use dealers can be counted on your fingers) actually sell the given vehicle to the dealer, then the dealer sells the SUV to you and makes a profit on the difference to what it paid the OEM and what it charges you. This means that the OEM gets money once for each vehicle.
What the OEMs would like is to sell subscriptions to individuals, not so much for entire vehicles (although there is that), but for options. What is perhaps the most notorious example of this is what BMW tried to do a while back, which is to charge a fee for those who wanted to use the heated seat function that was installed in the vehicle. That was pretty much on the heels of its earlier idea that if you wanted to use Apple CarPlay in your 3 Series, then you would pay a fee to BMW to do so. While that CarPlay play isn’t going to occur again, there are efforts by OEMs to develop their own competitive systems, which is where the fees are likely to sneak in. What’s more, what is becoming more common and seemingly acceptable are fees that are charged by OEMs that will allow one’s electric vehicle to go faster: this is activated by an over-the-air software update.
While that may be exhilarating, it is also expensive for the individual who has both the vehicle: they have paid for the motor that is capable of performing at X + 2 but that motor is limited to X until they pay more to get that 2. Presumably a motor that can only provide X would be less expensive than one that can go X + 2, which means that those who have no intention of ever going X + 2 are paying more, and those who are interested in X + 2 pay a recurring fee to the OEM, so it makes money on both ends.
At this point—or a few hundred words back—you are wondering whether this was actually something written for Motor Trend, not Glorious Noise.
