Like BMW, Mercedes-Benz is trying to find new cashflow sources as the era of all-electric vehicles is slowly yet surely becoming reality. With an overall simpler build and fewer moving parts, battery-electric vehicles (BEVs) can require little to no maintenance if the energy storage unit and the motor(s) work properly. So, selling branded parts will become increasingly difficult as people gradually switch to BEVs.
Granted, dealerships make most of the maintenance money through their service centers. But the direct-to-customer sale model is becoming quite popular with EV buyers and might eliminate the need for dealerships to act like the middleman in the future. Brands like Mercedes-Benz might only need a simple showroom and a couple of EV technicians here and there who can also drive to fix customer vehicles remotely. And just like that, dealers become something completely unnecessary. Or, some will survive by adapting to the new world.
At the same time, all-electric cars joined us at a time when technology is evolving rapidly. Many of the latest hardware, software, and entertainment developments are now debuting or are being added to the automotive world. CES 2023 proved it.
On top of this, when we think of EVs as lacking the ability to generate emotion as a V8-powered car can, it’s easier to understand why zero-tailpipe emission automobiles need the best technology there is – they must give you something else to fill that void. For example, things like Full Self-Driving Beta on the Model S or a wide 8K screen for the rear passengers like in the BMW i7 are not just gimmicks. They replace, as Alfa Romeo beautifully put it, “La Meccanica delle Emozioni.”
Transitioning to an EV-only new car market also opens up the possibility for manufacturers to streamline the production process to previously unthought-of levels. Take BMW and its heated seats subscription as an example. The cars will have the necessary circuitry, but the option will only be made available if you subscribe or pay for it as part of a package that guarantees permanent access. A better example is Tesla which locks features like better acceleration or advanced driver-assistance systems behind a paywall.
But that’s not all. Through improved connectivity, automakers will be able to collect more data about their customer’s driving behavior. Once again, Tesla is a good example because it makes use of telemetry to evaluate which of its customers can get access to the FSD Beta program or who pays less for their rates. Things are rapidly changing.
You have to be ready for it
All this tells us that carmakers need new sources of revenue. And if it worked with Tesla, why wouldn’t it fit legacy automakers’ needs? If people pay $15,000 for the promise of having a self-driving car one day, won’t they spend money on more sensible features that are a lot cheaper?
That may be why Mercedes-Benz has an online shop for its EV customers. There you’ll find the much-debated improved acceleration feature that unlocks your electric car’s full potential through a, you guessed it, yearly subscription. We broke the news about it back in December before anyone else.
But the German marque also thought about using technology to better protect their customers’ cars. So, for only $25 (excluding tax) per year, a Mercedes-Benz owner can have more control over their vehicle and more peace of mind. Since thefts are a problem that expensive car buyers must consider, an option like “Stolen Vehicle Assistance”might come in handy at some point. Plus, it might also help with lowering insurance premiums.
The carmaker says that through this feature it will be possible to tell local law enforcement where the car is and if it has moved. However, it will only do so after a police report was filed, and a case number was given. Then, this information and other additional details must be submitted to the Customer Assistance Center. Only after these steps were taken a Mercedes-Benz partner will try and locate the car to send constant updates about its location to the Police. The brand says in the product’s description that “investigations may start immediately which can increase the potential of retrieving your vehicle.”
The monitoring automatically stops after 30 days if the car doesn’t send out another signal. Also, according to the details available on the online shop, tracking stolen vehicles is not the same as owners looking at their phones to see where they parked. This “Stolen Vehicle Assistance” feature requires a Mercedes me account but is operated through Mercedes-Benz by a partner that has a “security center.” That’s it. There aren’t other things uncovered at this stage in the buying process.
But wait, there’s more!
Customers who wish to add this to their car after taking delivery will have to wait a couple of hours before it is enabled.
Mercedes-Benz also offers a Vehicle Monitoring subscription for $15 per year. Using the Mercedes me app, customers can easily navigate back to their cars’ parking spot (within a one-mile radius), can track the vehicle’s movement if they lend it to someone, and can even activate a special Valet Mode that sends out notifications if the driver is being too curious or too happy about driving their expensive car.
Mercedes-Benz knows this may not be enough for its customers, so it also added Valet Service Mode and Beginner Driver Mode as a bundle for which buyers must pay $16 per year if they want more versatility from their cars. Parents can put the car in Beginner Driver Mode, which will limit the maximum speed possible to 75 mph (121 kph), keep the Electronic Stability Program (ESP) always on, and disable any Sport modes. The automaker says torque is “available at any time in battery-powered electric vehicles,” which may require young drivers to get used to the vehicle before getting access to its full potential. “Smoother acceleration enables a relaxed driving experience with the usual comfortable driving characteristics,” adds Mercedes-Benz.
On the other hand, Valet Service Mode does almost the same things as the Beginner Driver Mode – it restricts acceleration, limits the top speed to 50 mph (80 kph), keeps the ESP on, disables Sport driving modes, and hides personal information like navigation history and profile data.
Mercedes-Benz includes many more subscription-based features in its online store, which tells us this is not going to stop anytime soon. We will most likely enter a period where leasing a car won’t be enough. Other costs for options too attractive to miss out on might change our perception. It’s also possible that more and more carmakers will use this model to make money, even though right now, it’s suitable only for brands that have deep-pocketed customers.
Finally, those who want to experience full Mercedes-Benz ownership will most likely end up paying for all the gimmicks, while other car buyers will be left with a choice go over budget or miss out on a bunch of cool or useful stuff.