Cars

Why Your Next Car Will Be a Lot Like Your Phone

Published On 05/26/2016 Published On 05/26/2016
Your car and your phone are becoming more closely related
Courtesy of BMW

Cars used to be all about the driving experience. Speed, handling, comfort, and luxury were the ultimate measurements of a car’s value -- along with that jaw-dropping price you paid after making that terrifying financial leap to own a brand-new one. But as self-driving technology becomes more and more ubiquitous and ride-sharing programs spread, the desire to drive, much less own a car, is shifting dramatically.

In the coming decade, cars won't be a product to shop for, stress over, love, and maintain. You'll treat your next car a lot like your iPhone or Android: a tool, linked to a car company's network, for which you pay a lot less money than you do now to access it on a pay-as-you-go basis. And even if you do buy your own car, you'll still witness the Apple-fication of the way you upgrade it, value it, and interact with it every day.

BMW

Your car bill will soon look a lot like your phone bill

If you don't need to drive much, or just look at cars as boring appliances, it's a hell of a lot cheaper to simply use a car whenever you need to instead of owning one outright. It's why you see everyone from automakers, to ride-sharing services like Uber and Lyft, to Apple and Google, working to transform daily transportation into a clickable service. 

For example, BMW recently launched ReachNow, a car-sharing service in Seattle, which charges 41 cents per minute and 30 cents to park. That roughly equates to 44 cents per mile for the average 10-mile commute -- which is less than what most people now pay for their transportation needs: currently just over $700 a month, or 49 to 78 cents per mile, according to the American Automobile Association.

Of course, as the pay-as-you-go ride-share competition heats up, your car expenses will almost definitely become even lower. Just as you pay for data, minutes, and phone purchase installments on a monthly phone bill, you'll eventually pay for miles, gas, insurance, depreciation, and even software upgrades on a monthly car bill -- depending on how much you drove in that time period. 

As for the car companies, they'll enjoy a steady stream of long-term payments, instead of infrequent one-time purchases every few years when you decide to buy a new car.

And shared plans will almost always be cheaper

Just as cellphone plans encourage multiple users within the same circle of friends and family, automakers will provide similar incentives and discounts for your ride-share plan. Instead of paying for every mile you drive, you may be able to split the cost four or five ways. You will also likely have the choice of paying for miles or minutes (see above re: BMW's ReachNow). When it comes to your future daily driver, you should even be able to roll over last month’s leftover mileage or minutes into the next month, again, just like your phone.

Courtesy of Rinspeed

Entertainment will matter more than driving

What do you use your smartphone for the most -- talking, or wasting time on addicting cat game apps, looking up directions, and making mediocre Snapchat Stories? More than anything else, your phone keeps you connected and entertained; your car is already following suit. 

Most high-end luxury sedans, such as the Mercedes S-Class and BMW 7-Series, already give backseat riders oversized tablets that can be removed and used during the journey. Within a decade, these will become standard in average-priced cars like a Toyota Camry or a Honda Accord. Backseats haven't been this entertaining since high school, but what about the front?

The dashboard of the Tesla Model 3 has none of the usual boring buttons and readouts that make hours of commuting such a joyless chore. As self-driving technology advances, cars will be less about driving and more about avoiding the bumper-to-bumper boredom between point A and point B. Dashboards will look like one giant conveyer, displaying data about your trip and infotainment options; once legitimately self-driving cars are upon us,  you'll see huge dashboards sporting TVs and tablets, similar to the Rinspeed concept pictured above.
 

For owners, carmakers will emphasize software upgrades instead of model years

Nobody ever asks what year your cellphone is. Just as the demand for smartphones is largely driven by new versions of software and design upgrades (bigger screens, better visibility, longer battery life, better software), don't be surprised if cars get on the bandwagon and ditch the model year. 

Why? The greatest long-term cost in car ownership isn't gas, insurance, maintenance, or even the initial purchase price; it's depreciation. If a good-looking car from 2018 is just as appealing as one from 2025, chances are the automaker will want to minimize that depreciation by keeping it within a fleet of thousands of similar-looking models. Instead of selling a "new" car that's actually been in production for years, they'll emphasize software upgrades, changes to the interior, and new features that can be downloaded and installed, which will help enhance the perceived value of older cars and keep the depreciation monster at bay. Tesla is already marketing the Model 3 this way -- you'll soon see other car companies follow suit.

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Steven Lang is an auto auctioneer, car dealer, and former part-owner of an auto auction near Atlanta, Georgia. Feel free to reach him directly at his Facebook page which you can find here

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