You need to take a long trip. A convention six hours away. A cousin’s wedding. How do you get there?
You could drive, sure. But that isn’t easy, and you have a little budget to travel this month. Maybe a short flight? How much does the train cost? Or, you could kick back and read a book while your car drives you. That costs about $8.50 an hour. Cheaper than the train or the flight, and, not having to drive yourself, you could nap the whole way or catch up on season 6 of that show.
That’s the vision Volkswagen’s Klaus Zellmer offered in an interview this week. Once CEO of Porche’s North American operations, Zellmer has an intriguing new title at VW: Board Member for Sales, Marketing, and After Sales. It’s that After Sales bit that’s important here.
Paying for Features by the Hour
VW is one of several automakers openly exploring a new model of how to own a car. One that would involve paying for features long after you’ve bought a new car. “Going forward, we see the future as accessing mobility when you need it, not committing to owning one car for several years,” he says.
Today, automakers build many different versions of any one car. Some have sunroofs. Some don’t. Some have basic engines and comfort-tuned transmissions that will easily meet the needs of the average driver. Some have turbochargers and sport-tuned suspensions.
The price of any particular Volkswagen Tiguan can be thousands of dollars more or less than the price of another. Buyers decide which features they want at purchase, pay for them, and use them every day.
Under the new model, automakers would build every example of a car with every feature. Owners could switch them on and off for a fee – monthly or even hourly.
The pay-per-use model, Zellmer says, makes it “more cost-effective to fully load the car and switch it on or off according to a use case.”
Small Scale Pilot Tests
BMW, Audi, and Hyundai have all explored the idea, testing it in select markets or discussing it in presentations to reporters. They have only tested in small-scale projects. Audi, for instance, allowed customers in Germany and Norway to pay monthly for upgraded headlights.
VW has unveiled a concept car, the Trinity, that goes much further. Trinity owners could pay hourly or per-mile fees for more horsepower or sportier handling.
Now, Zellmer says, the company may use the idea to introduce self-driving cars. “Our cost modeling says if we charge €7 an hour [about $8.50] for Level 4 autonomous drive mode, this is a profitable business case,” Zellmer says, using a term that refers to fully self-driving cars no automaker has yet perfected.
The idea is “also interesting for the used market because we can respond to changes in residual value by switching on functions to raise the used value,” he adds.
Theoretical for Now
To be clear, there are no cars currently on sale with this technology. There is no release date when it will reach dealerships. But it’s something we’re keeping an eye on because it could radically reshape how you buy and own a car — and eliminate the idea of ever having to pay one off.
