Car subscriptions are spreading across the new-car market, but drivers are increasingly resisting monthly charges for features already installed in vehicles they have bought. Evidence from the connected-car sector suggests willingness to pay is falling, even as manufacturers pursue recurring revenue from software, connectivity and performance upgrades.
Asher Davis, 33, said he had been largely unaware of the trend until he was unexpectedly forced to shop for a new vehicle after nine years without doing so. He was surprised by how few cars appeared to offer features without some form of subscription attached.
“I feel like eventually I won’t have a choice,” he said.
Why car subscriptions are spreading
Modern vehicles are connected to the internet, allowing manufacturers to activate or disable functions remotely. That means equipment can be fitted during production but placed behind a digital paywall until the owner takes out a subscription.
Ivan Drury, director of insights at Edmunds, said he had experienced the change personally. His Subaru requires a subscription for location services and remote start, whereas both features were free in his previous 2024 Ford F-150.
“It’s becoming more frequent and more annoying,” Drury said.
He said the attraction for manufacturers was simple: they had the technical ability to control features that were already hardwired into a vehicle.
Dealerships, he added, were often uncomfortable explaining to customers that some functions on a newly purchased car were not available without an additional payment. But retailers were only intermediaries, with the cost ultimately falling on the customer.
Subscription offerings range from remote start and connectivity services to extra power. The dividing line for many drivers is whether they are paying for a continuing service or for hardware that was included in the car from the outset.
Drivers reject fees for built-in features
BMW tested a subscription for heated seats in markets including the UK, Germany and South Korea. The charge did not apply in the United States, but the backlash was strong enough for the company to abandon the scheme in September 2023.
Peter Anderson, a 36-year-old luxury-car enthusiast, said he would not want to pay again for heated seats that were already installed and included in the purchase of the vehicle.
He was more receptive to subscriptions that unlocked genuinely new capabilities. Software updates that improved performance, handling or driving modes could, in his view, offer sufficient value to justify a charge.
Volkswagen is testing that proposition in the UK. Its Power on Demand service for the ID.3 electric hatchback allows owners of Pro and Pro S models to pay £16.50 a month to increase output from 201 to 228 horsepower.
The additional 27 horsepower is already supported by the vehicle’s hardware. Some Volkswagen customers criticised the arrangement online, while the manufacturer said feedback from customers had been positive.
The cost behind the monthly payment
Subscription charges may appear modest beside the cost of financing a new car. The average monthly payment on a financed new vehicle reached $787 in the third quarter of 2026, up from $756 a year earlier, while the average interest rate remained close to 7 per cent.
But Sue Helper, an economics professor at Case Western Reserve University’s Weatherhead School of Management and a former chief economist at the US Commerce Department, warned that small recurring fees could become significant over the life of a vehicle.
“The important thing is to look at the total cost of owning a vehicle, not just the monthly payment,” she said. “A subscription that costs a few dollars a month may seem insignificant, but multiple fees can add up over several years.”
Helper said subscriptions could be reasonable for services requiring ongoing investment, such as connectivity or software updates. She argued, however, that charging for hardware already included in the purchase price raised a different concern.
“It wouldn’t be fair to say that the $50,000 vehicle is in fact not usable if a consumer doesn’t pay an ongoing fee,” she said.
She pointed to New York City’s “click to cancel” rule, introduced by Mayor Zohran Mamdani’s administration on October 1, as an example of a measure intended to prevent practices that take advantage of consumer behaviour from becoming routine.
Falling willingness to pay
The subscription model also carries risks for manufacturers. Helper said drivers who felt they were receiving less value for their money could be less likely to buy from the same brand again.
Data from S&P Global Mobility’s 2025 Connected Car Study showed that 68 per cent of respondents said they would pay for connected-car services, down from 86 per cent in 2024.
Manufacturers appear to be betting that the decline reflects how subscriptions are presented rather than outright opposition to the model. Drivers may reject a charge for heated seats but accept a fee for an upgrade that clearly adds performance or functionality.
Drury said the danger was that repeated small charges could gradually become normal, even where customers remembered that the same features were once included as standard.
“There’s huge backlash, but at the same time, if even anybody signs up, they make money,” he said.
