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Disclosure: I work for GM, anything here is solely my own opinion. Different revenue to a different organization inside the OEM. When you sell a $20k car, you
by csours 5y ago
Disclosure: I work for GM, anything here is solely my own opinion.
Different revenue to a different organization inside the OEM. When you sell a $20k car, you get maybe $1k in profit, maybe less. If you can get $8 monthly recurring revenue you get maybe $7 in profit. Also consider that the lifetime is not 5 years. The AVERAGE age of cars on the road now is over 12 years. My parents drive 20 year old cars.
Also consider the friction to cancel. Maybe you get a few more months of revenue with someone sells the car or after it gets scrapped.
To be clear, I am not arguing in favor of this kind of thing at all.
- alistairSH 5y agoAlso consider that the lifetime is not 5 years. The AVERAGE age of cars on the road now is over 12 years. Do 2nd owners typically subscribe to optional services?
- deleted 5y ago[deleted]
- elil17 5y agoNo, but my guess is Toyota is hoping that they will for this because it’s more of a core feature