Mary is making things happen over at GM, actually announcing subscription REVENUE numbers. $2 BILLION current, $$5 BILLION future commitments.
From Business Insider:
Mary Barra, GM's CEO, boasted major gains in the company’s subscription base.
General Motors said its in-vehicle tech services generated nearly $2 billion last year.
GM sells three main subscription products: safety features, in-car internet access, and hands-free driver assistance.
GM told Business Insider it plans to add features through updates over time, reducing the need for new car parts.
General Motors has been pulling a Tim Cook and boosting its software and subscription business.
During the automaker's Tuesday earnings call, CEO Mary Barra highlighted the rapid growth of GM's in-vehicle software and subscription business.
In the past nine months, GM's software generated $2 billion, and customers have already signed up for about $5 billion in future subscriptions.
The company said it now has 11 million subscribers for its OnStar safety system, up 34% from a year earlier. Another half a million customers are also paying for Super Cruise, its hands-free driver-assistance system.
Now, that's still just a fraction of its total revenue, which was $45.29 billion in the last quarter alone. But the margins on those services are also higher than on cars sales.
GM says its software business keeps roughly 70 cents of every dollar it brings in. That's a rare level of profitability in the auto industry, as many car sales generate just four to 10 cents per sales dollar.
"We are also executing plans to grow software and services like OnStar and Super Cruise to generate even greater revenue during and after each vehicle sale," Barra said on the call. "We think there's a growth opportunity there with very attractive margins."
"Software and services are becoming increasingly important to how customers experience GM vehicles and how we deliver value beyond the initial purchase," a spokesperson told Business Insider.
The company also said it will keep adding features and services to vehicles over time, rather than relying on hardware upgrades.
"As vehicles become more software-defined, we can introduce new digital experiences through updates and optional services rather than hardware changes," the spokesperson added.
The subscriptions push comes as automakers look for new ways to make money after cars leave the dealership lot — especially as Detroit automakers roll out new electric vehicles.