While American Volkswagen shoppers haven’t been able to buy a small electrified model in years, over in Europe, drivers can buy a Volkswagen called an ID.3 Pro, a roughly Golf-sized electric hatchback capable of 228 horsepower. Sounds great, right? Well, there’s one catch: In Britain, the ID.3 Pro actually only makes 201 horsepower as standard.
It’s no secret that we’re in the monetize-everything era of the car, because automakers aren’t just looking for one-time revenue, they’re looking for recurring revenue to maximize shareholder value or something like that. If it can be downloaded over the internet, someone may try to make a subscription service out of it. That’s exactly what’s happened here – Volkswagen has put 27 additional horsepower behind a paywall. Once you buy the car, you can choose to subscribe to the horsepower boost or digitally purchase it outright. As AutoExpress writes:
This subscription currently stands at £16.50 per month. That’s almost three times the price of a ‘Standard with Ads’ Netflix subscription – following a one-month free trial – or a total of £165 per year. Owners can also choose to select a lifetime subscription for the grand total of £649, with this being attached to the car rather than the individual, meaning the upgrade will remain if the vehicle is sold on.
At the time of writing, that works out to $22.29 per month or $222.91 a year to subscribe to an extra 27 horsepower, or $876.77 to buy it outright. Not obscenely expensive, but not cheap on a vehicle that already costs the equivalent of $48,263. At least Volkswagen promises not to take it away should the vehicle change hands, but why not just include such a modest bump in output as standard?
To be fair, Volkswagen is only advertising the ID.3 Pro and Pro S at 201 horsepower, and it certainly isn’t the only manufacturer to put power behind a paywall. Ford offers a $995 “Performance Upgrade” add-on for the Mustang Mach-E GT, Mercedes-Benz offers an 80-horsepower boost on the EQS 450 4MATIC for the incredibly strong sum of $2,950, and Volvo offers a “Performance Mode” with an extra 33-horsepower on British twin-motor XC40 Recharge crossovers for £500. Then again, most of the vehicles I’ve mentioned are luxury or performance models.
However, here’s where putting horsepower behind a paywall gets uncertain: Insurance. As AutoExpress notes: “As the car is registered at 228bhp from the factory, owners won’t need to inform their insurance company, either way.” However, vehicle power output often plays a role in determining insurance premiums, so while it’s impossible to say for certain whether ID.3 Pro insurance would be cheaper if it were registered as a 201-horsepower car, it’s also impossible to say for certain that it wouldn’t be.
So what’s Volkswagen’s rationale behind this? Well, some of it is going to make you squint a little bit harder at your desktop, laptop, smartphone, tablet, whatever you’re reading this on. In a statement to AutoExpress, the automaker said:
Offering more power to customers is nothing new – historically many petrol and diesel vehicles have been offered with engines of the same size, but with the possibility of choosing one with more potency. These traditionally are higher up in the product range, with more specification and a higher list price.
Historically, a high-output combustion model usually came with a different engine, which came with the cost of different physical parts, the support network for those different physical parts, and all the hidden research and development and homologation costs that come along with that change. Here, we’re dealing with the same battery pack, same motors, just a new software calibration that’s already approved for road use.
At the end of the day, if a car is capable of offering a feature with all existing hardware and no continuous outside digital support, why not just make it standard, especially if it’s already been developed and homologated? Surely, it won’t add £649 to the warranty costs of every car, yeah? While the outrage here is probably disproportionate, considering Volkswagen didn’t pull anything like a bait-and-switch, it’s okay to be a little mad. If this is the future, it’s not necessarily an improvement.
Top graphic image: Volkswagen
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So at £16.5/month and £649 for a lifetime purchase, you would need to pay the monthly fee for 4 years to break even with the lifetime purchase price.
So what does VW do if you subscribe for 4 years? Does it automatically convert to the lifetime subscription, or do you keep getting charged?
Keep getting charged, obviously.
Does Spotify send you an LP if you listen to it enough to have purchased it outright? Of course not, they keep milking you for that sweet subscription money.
Ditto furniture rental companies…they’ll happily let you pay them thousands of dollars for a $300 tv.
*inserts Fry I’m shocked gif* and *inserts LOTR so it begins gif*
I would rather subscribe to 1 single actual pony, than subscribing for these 27 lame horses…
(/Chris Rock voice) “How much for one horsepower? You got change for a hunnid?”
Unlike an ICE-powered car, an EV would only suffer additional wear and tear to things like suspension and braking components, and whatever additional damage higher-speed vibrations might cause to things like window regulators, sunroof mechanisms and the like.
So, unless VW UK PLC offers a warranty of less than six months, yes, it would. Easily.
I can’t really even buy an argument that this is paying for an HP boost without voiding the manufacturer warranty, since VW would presumably keep charging this subscription fee past when the warranty would expire.
How does this work for a used car? Say you buy this car in 10 years from someone who paid the full price for the extra horsepower (obviously this is hypothetical; VW doesn’t make a modern product that lasts 10 years), do you get to keep that as the used car purchaser? Or does VW get to double dip on you?
App no longer supported?
The article states that if you buy the upgrade outright, it stays with the vehicle even if sold.
If you went with the subscription instead, the new buyer might benefit from you forgetting to unsubscribe I guess!
Volvo has done it for years…. and now it’s a separate (somewhat) electric car company.
The issue isn’t the by wire upgrade, it’s the subscription model. If a previous owner upgraded to Polestar on a Volvo- it was like that forever and added value. the issue is the temporary non-transferable mod- like Tesla is known for doing….
Yeah bought a Polestar 2 a few months back and the previous owner added the performance boost so it just stuck with the car which is nice. Things like subscriptions and tied to the owner and not the vehicle is stupid.
Jason, being the eternal VW fan-boy, how is he spinning this news as something being “good” for consumers? You guys have always been too easy on VW what with their shit quality, dieselgate corruption, god awful user-interface and touch controls, and just in general sub-par products.
Ford offers a tune for their motors that is installed by a dealer and backed by a warranty and they were lauded from what I recall. No new hardware besides a computer and maybe a different air filter.
Why do I hate this so much more?
Ford’s tune is a one-time event. That’s the key. ONE PURCHASE, rather than eternally paying for a tune.
Plus, I could have sworn there was at least some new hardware that was needed. But I think that might depend on which specific vehicle you are talking about.
VW is also offering this as a one-time purchase for £649.
There is a VERY long history of unlocking more power from a VW turbo engine with nothing but a ECU tune – both in the aftermarket and from VW direct.
That’s not unique to VW. Heck, pretty much all turbocharged engines are like that.
Correct. Yet people freak out when automakers do the same thing with an EV.
Because upgraded tunes for engines are usually a post-release development, it takes extra time/work to make them happen, upping the boost is a very delicate process that requires more R&D with timing, fueling and durability testing. Even with an EV, where fewer variables are at play, I’d be happy to pay for an upgraded tune if it was actually something that took extra time to develop after the car’s launch. But this time, we’re looking at power that was baked in from launch, being pulled back and paywalled.
Pretend you’re at Subway, and you just got a sandwich, and they ask you if you want it toasted. That doesn’t add any ingredients, but it’s worth the extra dollar to eat a hot sandwich sometimes. Now, imagine that they make a hot sandwich by default, and say that unless you give them an extra dollar, they’ll have Subby the Ice Dragon (whom they keep in the back) breathe on your sandwich before they hand it to you.
VW has offered different spec engines with nothing but software differences for decades. Especially in Europe where they offer a bunch of different options before you even start getting in to the Audi versions.
From the factory the 4th gen Golf was offered with 4 different versions of the 1.9L TDI PD engine at the same time. 100 hp, 115 hp, 130 hp, and 150 hp.
The biggest issue is eternal monthly payments. This specific example might allow a one-time payment, but that’s not where this is going. What these automakers ultimately want is for a new owner to buy a monthly upgrade, pay every single month for that upgrade, then when he trades it in, the dealer will delete the upgrade and force the new buyer to repurchase it all over again. The you-own-nothing-so-pay-a-subscription-for-the-rest-of-your-life business model.
Upgrades to ICE vehicles have never been quite as easy as ones that can be done to EVs. Automakers might hold back some power from ICE vehicles because of emission or reliability or daily driveability or efficiency. Those aren’t issues for electric motors (for the most part). So that means that car makers are purposefully sandbagging the lower power car just so they can nickle-and-dime you with a subscription to unlock the more powerful version.
Lower HP engines that have been “sandbagged” are not new to VW – they have been doing that for decades. See my example above where VW offered 4 versions of the 1.9L TDI from 100 to 150 hp in the Golf – at the same time – at different price points.
Because one is a one-time-cost factory supported tune (probably because the tune can’t be done for everyone due to emissions, but can skate by as an aftermarket add on), the other is nerfing the car and charging you monthly to get back what it could have done without interference.
The same way DLC used to be an addition to a game, now you buy 80% of a game and pay extra if you want to play the rest.
Couple differences I can think of is the Ford tune requires premium fuel, so making it optional may be desirable for that reason.
Others have noted that an ECU tune is something people are used to paying for from the aftermarket, so a factory tune is also more desirable in that regard. Even if the result is similar, it feels different because it’s an “ECU tune” and not “paywalled horsepower.”
And as others have noted, I would not actually find this as offensive if it was a one time purchase. It’s the recurring fee part that makes it feel smarmy.
The premium fuel is a big difference. Thanks for pointing that out. Having to run premium is what has kept me from installing it. That does change the way you interact with the car, in a way, outside of just being slightly faster.
They developed the car at one power level, then went back and did some more testing to make the upgrade possible, probably after making some refinements to the control system post-launch. Then, after spending some amount of funds to develop the tune, they sell it as a one-time purchase that takes actual work to install. You’re paying for the labor of installing it, and you’re buying it as a product.
VW, meanwhile, made both tunes from the start with the intention to seek rent on the last bit of it.
if you have to stretch this far to pay for this monthly, you can’t afford the car.
anybody who is putting you on a monthly subscription on prebuild hardware that is already at $50k mark is just a greedy fucking bastard
Shocked Pikachu face.
Talking with OEMs in Europe, this is more common than you might think with the litany of overlapping engine options for any given vehicle.
I’m, honestly, less angry about this as opposed to full functions are paywalled (BMW’s heated seats, for example).
Farging corksuckers.
You shouldn’t charge me a subscription for horsepower Johnny. VW charged me a subscription for horsepower once.
Once
I see you like to live Dangerously
Johnny Dangerously: “Yes, I like to live.”
I was gonna say iceholes, but…it goes both ways.
I don’t really have a problem with a subscription model, especially if you can purchase a lifetime one, but for one thing: subscriptions, even the lifetime ones, do expire for a variety of reasons. Even if one opts for 1-time buy out I would bet this will still get “validated” except you won’t be charged every month. But, 10 years on, the servers may be phased out, subscription models may change and “oh look, you no longer have what you’ve paid for, g’bye”.
Here’s the problem with a “lifetime subscription” – even if you pay once, you don’t actually own it. You have just paid for a license; read the fine print, that license can be revoked or the terms and conditions changed at any time by the manufacturer. This isn’t about the horsepower, it’s about forcing customers into a false choice. You can either pay for the one-time license which gives us the option of slipping all kinds of BS into the licensing agreement down the road (which may include permission to brick your car at any time, download the contents of your phone and use your contacts for marketing or just to sell to data brokers – really insert any nefarious shit we like) or you can keep paying us monthly and we can still insert any nefarious shit we like and you never “own” your car in its entirety.
The entire licensing model of car ownership needs to stop now, this is just the beginning of “you don’t own the car, you just have a transferable license to use it” – and that should worry everyone. It’s already here with games, media, and software (including the software in your car).
I’m not going to defend VW here (especially as someone who generally dislikes what happens when subscriptions become the norm), but would like to make a few counterpoints:
VW’s deep tuner history means that owners have long been able to spend $500-$1,000 and reliably boost power (in ICE engines) reliably, which often led people to wonder why it wasn’t offered from the factory.
Forced induction and EV cars do make it a little too easy to de-tune the car, then turn around and attempt to monetize what many users feel like should be the default.
Countless cars have better performance on 93 octane, but more than 90% of the gallons pumped in the US are 87. In reality, most users just don’t want to bother with an extra dollar a gallon in perpetuity (which is a different rant on octane/cost differentials).
I think there’s a marketing failure here — VW made it a subscription and it should have been a one-time purchase, pitched as the “power pack option” or whatever. Even though it costs them nothing, they could argue that people choosing that option might have higher warranty claims, which justifies the upcharge.
The subscription is absolutely the problem here. Ford has a program on a few of their vehicles where they do a tune with either minimal new parts or possibly no new parts, and it adds X horsepower to their vehicles. But its a ONE TIME PURCHASE. And Ford is not alone with this. But you pay once, you cry once, not this eternal monthly payment nonsense.
It can be a one-time purchase if you want it to be. If there’s a marketing failure here it’s that they are emphasizing the subscription option rather than the other option.
I expect so little from VW and even then they find ways to disappoint.
Right, thanks for pointing that out. They should pitch it as the one-time purchase BUT they can also finance it for you at zero percent (or whatever).
For me, the issues with subscriptions are the “perpetuity” aspect, plus the sunsetting of support whenever the manufacturer decides.
That’s only in some places, however. Everywhere I have lived in the US, the difference is only $0.40-$0.50 from 87 to 91. The only times I see a dollar-plus difference is in the Midwest, and there the 87 is dirt-cheap.
Interesting — everywhere I went in the US before about 2010, 30-40 cents was the norm. Then suddenly the signs all switched to showing one price (when they used to show 3-4) and overnight it was like 93 became an 80 cent surcharge or more.
Anecdotally this is mostly the South, plus FL, and some Midwest and Mid-Atlantic states. Its seems to be pretty universal in those places now.
Last night I filled up at a station near Detroit. The surcharge was absurd.
Regular was 87 octane at $2.89. Premium was $4.59, so the surcharge was $1.70 per gallon, which is more than 50%. And I’m not even sure the premium was 93 octane instead of 91 octane.
This is why I’ll never again own an engine that requires premium fuel. Premium fuel as an option for maximum output is fine. Required? Never!
I’m all in favor of retailers taking advantage of wealthy ignorance to create profit, because that tends to suppress prices for average consumers. However, I’m going to be very careful to never buy those products myself.
A K&N intake for a gas powered GTI is $400 and that gets you no guaranteed horsepower.
This subscription is silly, but I think it’s silly to subscribe to satellite radio that offers the sound quality of the MP3s I ripped on my HP Pavilion with an Intel 386.
Conversely, I still have SiriusXM because the combination of an unlimited phone data plan and a Spotify subscription is still a lot more, and I’ll end up just “echo chambering myself” instead of hearing deeper cuts or new stuff. If you have those two already on your phone, then it’s obviously the better choice.
The more I’ve thought about it, the more a lot of entertainment options are dependent on the number and diversity of passengers in the car, number of different devices that need to be paired, etc.
I have a very short commute and I listen to podcasts on longer drives.
Every time we get a new car they bundle satellite radio. I play with it, listen to some things and then turn up the volume when a song I like comes along. That’s when the shortfall in sound quality becomes obvious. After that, I start noticing the constant ads and the limited playlists.
Satellte used to be much better. No ads, a lot of variety. There were several good comedy channels. Before long I would hear repeats of comedy bits within an hour, and there were a lot of Jeff Dunham bits. Regardless of his other issues, he is a prop comic relying on puppets. This is an act that doesn’t translate well to radio.
I know that Sirius puts on commercials on most stations but the music stations are mostly commercial free. They do tend to repeat a lot unless you go to the deep tracks stations.
I swear that most of the ads I heard were for other programs or other stations, which I couldn’t understand. They are cutting into their own programming to promote other programming – but there is no more money in it for them if I change the channel.
They are showing the variety they have which may keep you as a subscriber.
I may be the only one, but it’s a top reason I am not a subscriber.
Another reason might be to encourage a passenger to subscribe. I was a long time subscriber, but eventually gave up due to the price and lack of listening (the rise of podcasts – largely of shows I found while I had XM.) Then I bought a Ram truck and it came with 3 free months. I let it expire. Then I had a recall done and they gave me a free year. When that expired they send me an offer I couldn’t refuse – $99 for 3 years. That just expired and the new offer is $3/month, with app access (so I can really use it in all of my cars.) I like it on long trips, and during football season so I don’t miss a game I want to hear while at work. While they do say a few words between songs, it beats the heck out of all the commercials on FM.
I keep the cheap as dirt talk-only Sirius subscription on my Mercedes for my drives between FL and ME. It’s like $30/yr. NPR and the comedy channels and I can drive 12hrs a day solo. I find music absolutely unlistenable on it though.
Ok, so depending on your country, you may get taxes and/or insurance premium based on 228hp but you actually only have 201? Such an offer must be hard to resist.
Offering more power to customers is nothing new – historically many petrol and diesel vehicles have been offered with engines of the same size, but with the possibility of choosing one with more potency. These traditionally are higher up in the product range, with more specification and a higher list price.
They are also ALWAYS a single time purchase made when new. I wouldn’t be mad if they offered it as a one time fee only, but to offer it as a monthly charge is so tone deaf to the reality of the current economy.
Yet I’m sure the counterpoint is “money is tight for a lot of people!” which is an easy excuse while we’re all slowly demoted into serfdom 🙂
I guess the counter argument is if I’m only going to own the car for 2 years and don’t care about the next person, I can pay less overall and enjoy the subscription while I have it.
Rather weak justification perhaps, but they do offer the one-time price as well so I have trouble getting too upset over this one.
And it also stays with the car. Doesn’t Tesla take back the $10k self-driving stuff when the car changes owners?
I do kind of like the “try before you buy” aspect of it. Is the 27hp worth it? Only costs you a month’s subscription to find out. But overall, I think it is still BS that needs to stop – and really they should offer a month for FREE to let you try it and see if you want to buy, given there is ZERO cost to them to “install” it.
An equally week justification is the subscription lets you try it for a few months before deciding whether it’s worth committing to.
VW is offering either a £16.50 per month subscription OR a one time purchase of £649
Any car company with a subscription for hardware I already purchased will never see me in a show room. Ever.
I swear, I will drive a clapped out Crown Victoria with a family of packrats living in the seat before a car company with that business model sees a single red cent of my money. Every single person buying these subscription-cars is guilty of perpetuating this problem.
I really wish I had the money to put up a bounty – $10,000 for an open source crack to unlock subscription nonsense. For $50,000 someone could incentivize hackers to open up 5 different carmakers firmware and make millions of people happy.
If the power increases causes extra wear on the components and the upcharge is to cover possible increase in warranty claims then maybe, but just a 13% or so bump in power? I’d expect at least a good 50hp or more to justify it. Depending on how the power is mapped it may not even be noticeable in normal driving, so then you’ve paid for, well nothing.
This is exactly what I was thinking (though I abhor the monetization of everything). Some of the cost for the “performance” packages have to go to the higher risk of warranty work and I can begrudgingly understand this. But in this specific case though it seems maybe this is only in UK and other markets get the full HP, with what I’m assuming is similar warranties.
So this case I think gets the BS stamp of approval.
Here’s the thing though: the only way for that justification to work would be if VW only charged for the extra performance during the warranty period.
So then another question is, if I’m like 3rd owner 10 years down the road and 100k miles in, and want to unlock the power boost, will VW do it?
Of course they will, they want the money.
If no one paid for the “lifetime subscription”, probably. Though I guess the full T&C haven’t been made public yet
Just add it to the VERY long list of reasons I will never own a VW product unless it’s over 30yrs old.
I’d go with about 20 years, the Beetle was made up through the 2004 model year, and the Type 2 kept its air cooled flat four up through 2006
This is they kind of S**t that makes people start building guillotines.
And if the blades aren’t sharp, oh well, we didn’t have the money to for that.
Is there an elegant French name for a guillotine-like device that just drops a 500 pound granite block on someone?
How do you say ACME in French?
If the insurance issue is truly at play, I can understand offering more or less hp for a nominal fee if that would sway an owner in or out of a purchase, but subscriptions to speed is just stupid. On the bright side, VW is loudly advertising that the mechanicals are completely capable of safely making more power, so could easily be tuned to do it.
Is this with or without the UKs 20% VAT? I get frustrated when the sale price is blindly converted to USD and everyone goes “wow that’s expensive!” without considering taxes that wouldn’t apply in the US.
And also purchasing power parity, as well as market-defined norms.
One of the most educated finance professors I had (American-Brit) told me back in the late 90s that the decision to buy a GTI in the UK was about on par with an M3 in the US, at least in terms of commitment of discretionary income, plus differences in taxes and median incomes.
I still like that analogy and think it holds up. Direct currency conversions are always a little dumb.
Their rationale is, of course, pretextual, but they are right that is a thing that’s done with gas vehicles. In fact, the first thing that jumped to mind is the Mazda CX-70/90. The lower trims have a detuned version of the exact same turbocharged inline six. Going up to the “S” trims gets you full output.
To be clear, I don’t understand why Mazda did that either. They have always liked having a million trim levels for cars though it’s frustrating.
Although if my understanding is right, the higher output versions require premium fuel, while the lower output ones are fine on 87 octane. I can understand the argument that lower trim buyers are less likely to stomach the 25% fuel price hike, but it also does align with locking power behind a higher trim.
You know that’s an excellent point. That’s a more legit reason to offer two tunes. If you’re price sensitive you may want to run 87. I know with the amount I drive it’s a big savings
It’s certainly a nice option to have, My CX-30 Turbo has different maps for both 87 and 93, so I can save money if I’m willing to go from 250hp to 227, which I usually do. It’s really not a big deal to me since it’s only a 10lb-ft of torque, the detuned 310 which in a CX-30 is still plenty.
The difference is the lower trim packages are cheaper and you know exactly what you are buying up front; you aren’t paying monthly to unlock the Touring package features – with pricing the car company can change at any time. “Oh, our sales are down and we need the books to look good for the quarterly report, raise the price of horsepower on all existing cars by $1 a month and blame it on (spins wheel) interest rates.”
Mazda has more trimlines than actual Mazda cars I see on a daily basis.
I hear their popularity is mostly confined to the coasts. Here in the mid Atlantic I see them everywhere all the time
Harvest your dollars from the dummies, ‘cuz you ain’t getting mine, that’s for sure.
Volkswagen and shooting themselves square in the dick-name a more iconic duo
GM and shooting themselves square in the dick?
People who aren’t auto executives and not wanting bullshit subscriptions for their cars