SUNNYVALE, Calif. — Software-based vehicle upgrades generated more than $1 billion in revenue for Mercedes-Benz last year, the automaker reports. That's only a fraction of the more than $150 billion in global revenues the automaker earned in 2022, but the business could explode after 2025 when Mercedes launches its own operating system that will open the door to more digital services in vehicles.
That's also when Mercedes will roll out a robust menu of on-demand services, including charging and automated driving features.
"By 2025, we are targeting more than €2 billion ($2.12 billion) from our connected car park," Mercedes-Benz sales chief Britta Seeger said. "Automated driving functions are expected to emerge as our largest software-enabled revenue driver by 2030."
Automakers say they believe digital subscription services can create a lucrative revenue stream by selling customers new features and functionality long after the vehicle drives off the lot.
Ford Motor Co. projects that the global market for connected functions such as its BlueCruise driver-assist technology, new features and upgraded software content could top $20 billion by 2030.
Digital extras, such as live traffic information, online music, vehicle monitoring and remote engine start, play a "fundamental role in the decision to purchase a car," Seeger said at a media event in Sunnyvale, Calif.
"Our connected car park is forecast to grow by 60 percent in the next three years," she said. "This will have a huge impact on our software-enabled revenue."