The Chevrolet division of General Motors Co. (NYSE: GM) announced on Thursday that U.S. Chevy owners with an in-vehicle OnStar 4G LTE Wi-Fi hotspot can now purchase an unlimited, prepaid data plan for the vehicle for $20 a month. GM is the first company and Chevy is the first brand to offer an unlimited data plan for in-vehicle use. The offer became available Friday, March 3.
In 2016, Chevy owners used nearly 200% more data than they did in the prior year, and in the second half of 2016 alone Chevy drivers used almost as much data as they had in the previous 24 months. Last June Chevy cut the price in half on its 4 gigbyte (GB) per month data plan (to $20) and its 10 GB package (to $40).
At the time, a Chevrolet executive said that as more people use the technology the price falls and the lower price encourages even more usage.
GM’s North American president and head of the Chevy division, Alan Batey, said:
We have contractors bidding jobs in their Silverados, families streaming movies in their Suburbans and Malibus and everyone tapping into the cloud for music.
Chevy has sold more than 3.1 million vehicles equipped with the OnStar 4G LTE technology since 2014. The wireless service is provided by AT&T and does not require a long-term commitment.
The long-term goal for GM and other carmakers is customer retention and loyalty, plus incremental income that could grow substantially over the next several years.
Cars are marketed and sold today in pretty much the same way they were 110 years ago: carmakers build a car, sell it one-time and pocket the revenue and profit. Every couple of years automakers refresh their designs and hope that current owners will buy a freshened up version every five to seven years.
Car ownership patterns are changing as more people use ride-sharing services like Lyft and Uber or buy into GM’s own Maven ride-sharing service. GM announced Friday a new Maven “Reserve” plan that lets customers hold onto either a Chevrolet Tahoe or an extended-range electric Chevrolet Volt for 28 days for a per-month price that varies depending on the vehicle. The Tahoe is priced at $1,500 and the Volt at $1,100 a month. Included in each reservation is parking, insurance and $100 worth of gas.
For now the service is available only in San Francisco and Los Angeles. Cadillac offers a similar service, called Book by Cadillac, that launched earlier this year but has not been a raging success. Like Maven Reserve, it costs $1,500 a month, and includes the ability to change vehicles every month. Also like Reserve, Book by Cadillac covers insurance on the vehicles.