The remote start functionality of FordPass Connect lets customers precondition their vehicle for added comfort and convenience on those hot or cold days.
Ford
As automakers scramble to find new revenue streams overcome stagnating and even falling sales, connected services are becoming ever more important. General Motors launched the first cellular connectivity system with the debut of OnStar back in 1996 and we are rapidly approaching a time when nearly all new vehicles will be connected. Ford’s system, dubbed FordPass Connect launched just a few years ago with a promise of up to five years of free service. Ford has now decided that it’s more important to generate revenues from services running on top of FordPass Connect so it’s making the connectivity free for life.
Ford was relatively late to party in adding telematics to its vehicles. Instead, Ford followed a bring your own device approach with SYNC that let people use their phones to run various apps and provide media. While some plug-in vehicles and Lincolns got it earlier this decade, it’s only been in the last three years that it has been spreading to everything in the lineup. By the end of 2019, every new Ford should have FordPass hardware built in.
GM has built in OnStar hardware to everything it builds for more than a decade and premium brands have been doing the same. Increasingly mainstream brands have been going down this path as well. Most are now offering some basic services without a subscription fee for three to five years along with other premium services such as turn-by-turn directions, emergency services and automatic crash response for additional monthly fees.
For now at least, Ford is the only mainstream, full-line brand committing to the suite of services it has without fees. Those functions include remote locking/unlocking, starting, fuel level checks, vehicle health reports, and roadside assistance from the FordPass app. However, competition is a wonderful thing and it wouldn’t be a surprise to see GM, Fiat Chrysler and others follow Ford’s lead. If they do, we may see other features added to the free offerings.
As automakers have added the connectivity hardware they have been baking the cost as well as the limited amount of data connectivity required for these free services into the bill of materials and price of the vehicles. Unlike the earlier days of OnStar when the cellular radio was turned off if the customer opted not to subscribe to a paid service (which most didn’t), the connections now stay live. This gives automakers the opportunity to collect telemetry data about how vehicles are used and are performing in the field that can be fed back into the product development process.
It also allows manufacturers to leverage the data for other money making services. For example some, like GM and Hyundai now offer drivers the opportunity to share data about they drive with insurance companies. In return, the customers can get premium discounts for safe driving habits and automakers can get affiliate fees from insurers for making the connections to customers and providing data. As they prepare to launch vehicles that support over-the-air software updates, they will also be able to utilize these data connections.
Manufacturers hope that by providing services like the ability to automatically schedule dealer maintenance visits or the ability to find and pay for parking before arriving at a destination, they can enhance customer loyalty. It may at first, but like other features, eventually, it will likely just become the cost of entry.
