GM requires Buick, GMC buyers to buy $1,500 OnStar subscription

DETROIT — General Motors has begun requiring all Buick and GMC buyers to pay $1,500 for a subscription service that previously had been optional.

The mandatory upcharge provides a three-year subscription to OnStar, GM's long-standing in-vehicle safety, security and connectivity service. It's included in the manufacturer's suggested retail price of all Buicks and GMCs ordered starting June 2 and all Cadillac Escalades ordered starting July 18.

The $1,500 plan is listed on the window sticker as a separate line item along with other additions to the vehicle's standard equipment, but there is no option to remove it or order the vehicle without it. Customers who decline to activate their OnStar service will not be given a price reduction, GM said.

The Detroit Free Press reported the compulsory OnStar charge earlier Tuesday.

"By including this plan as standard equipment on the vehicle, it helps to provide a more seamless onboarding experience and more customer value," GM spokeswoman Kelly Cusinato told Automotive News in an email.

The vehicles' OnStar service will be activated at the dealership during the delivery process. Customers will receive OnStar and Connected Services Premium, the top-end plan that GM sells separately for $49.99 a month, according to the OnStar website. The $1,500 add-on is equal to $41.67 a month for three years.

OnStar is a key part of GM's plan to earn $20 billion to $25 billion in software and services revenue by 2030. OnStar Insurance, separate from the OnStar service GM is now requiring on certain vehicles, could drive $6 billion in annual revenue by the end of the decade, the automaker said last year.

On average, customers subscribe to 25 products and services and will spend $135 per month on them, according to GM's research.

After the three-year OnStar plan expires, customers will be asked to subscribe again. Their subscriptions will not be renewed automatically, GM said.