BMW (BMWYY) has just created a big problem for itself.
When consumers in most countries are facing sharp inflation for many goods and services, the German luxury carmaker just announced a fee-paid service that will not do its image any good.
In the automotive sector, the recent additional costs are particularly steep. Since the pandemic, car prices have exploded due to low inventories. Carmakers have closed factories for lack of parts to assemble certain models. That's because employee illness and lockdown restrictions in key countries like China have disrupted supply chains.
In addition, Russia's war on Ukraine has boosted the cost of raw materials such as palladium, cobalt, nickel and others.
All this collectively hammered consumers because the auto groups passed on these unexpected costs to them. And then drivers must tack on a surge in gasoline prices at the pump. Owning a car has thus become a much more expensive proposition than it was not that long ago.
'Someone at BMW Will Be in the Hot Seat'
It is in this context that BMW has decided to offer vehicle owners a service to heat their seats to warm up their derrières -- at $18 a month, or $180 a year.
Customers can also subscribe for three years for around $300 or take unlimited access for almost $415, according to BMW's website in the U.K.
This service is offered in many countries such as France, Germany, the U.K. and South Africa. For the price, the German company will deliver a software update that will heat the seats. It's a service on top of everything these customers are already paying for.
BMW
This heated-seat service is not offered in the U.S.
Even, or especially, because the service launches in mid-summer, it has aroused strong reactions on social networks. The brand is the subject of mockery and caricatures of all kinds.
"Crazy this, someone for sure at bmw will be in the hot seat after they’ve announced this," a user commented on Twitter.
"In the hot seat. 🔥 The all-new, 4-door, BMW M235 Gran Coupe with optional M Sport seats in Magma Red perforated Dakota leather. #BMW #BMWGwinnettPlace," another Twitter user posted.
" Talk about being in the hot seat. I’ll NEVER buy BMW just for this," another user said.
The service gives BMW an image and public relations headache at a time when its high-end competition from rivals Mercedes-Benz, (DMLRY) Porsche (POAHY) and Tesla (TSLA) has never been fiercer.
"Take the hot seat; pay $15 - $30 as subscription. What next, BMW?" a Twitter user asked.
New Trend for More Money
As the Twitter user above noted, this strategy indeed resembles that of low-cost airlines which charge travelers for just about every additional service, ranging from luggage space to seat choice.
The same tactic also suggests that automakers may make more profitable use of over-the-air software updates. This strategy, initiated by Tesla, pushes new features and enhancements over Wi-Fi.
BMW
With this strategy, automakers who are already charging consumers extra money via superior hardware features will now be able to tap their budgets for software-driven features as well, fattening profit margins.
BMW, for example, charges for features like safety-camera information ($30 per month), steering wheel heating ($12 per month), high-beam assistant ($12 per month) in the U.K.
BMW
BMW didn't immediately respond to a request for comment.
