Ford picks Apple executive to cultivate subscription business
Ford today named Apple veteran Peter Stern to lead the Blue Oval’s newly formed Integrated Services arm, which will create and market software-enabled customer experiences across Ford Blue, Model e, and Ford Pro: its internal combustion–, electric vehicle–, and commercial business divisions.
Stern’s background at Apple is in increasing the customer base for additional or enhanced services, and it seems likely he’ll be expected to increase Ford’s bottom line when it comes to subscriptions. He was a “a driving force” behind the launch of Apple’s portfolio of subscription services, including Apple TV+, Apple News+, and Apple Fitness+, plus MLS Season Pass and Apple One.
“This is transformational, because the cornerstone of our Ford+ plan is creating incredible customer services and experiences enabled by great hardware and software,” Ford president and CEO Jim Farley said. “There’s simply no one in the world better able than Peter Stern to build this strategically vital part of our business.”
Stern is officially instructed to “build out the business tied to Ford’s BlueCruise hands-free highway driving system and productivity and safety/security services, including those from the Ford Pro Intelligence business; imagine and deliver exciting new high-value services, and lead services marketing, certain out-of-vehicle customer experiences and Ford Next.”
Ford is capitalizing on connected, digital platforms “that will revolutionize every aspect of how vehicles function, the way people interact with them, and the value those vehicles,” a press release said. The company has more than 550,000 paid software and services subscribers, with Ford Pro commercial customers today accounting for more than 80 percent of them.
“I love creating new services businesses and this is the perfect chance to do just that,” Stern said. “The auto industry is undergoing an unprecedented transformation, from gas engines to electric vehicles and from human to autonomous driving.
“At the same time, the basis for differentiation is shifting from the vehicles alone to the integration of hardware, software and services. I’ll be in the middle of something truly historic and am particularly fortunate to do that at Ford, which has been democratizing automotive technology for 120 years and counting. You couple that with the Ford family’s involvement in the business and commitment to doing the right thing in the long term and this is really where I belong.”
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I’ve yet to see any car company provide a convincing incentive to buy into a subscription model for their vehicles. Paying a monthly fee to use a basic feature like cruise control or heated seats sounds absolutely absurd.
All I can say to this guy is “good luck.”
Screw Ford and their guy from a company with a rotten fruit logo. Subscription services for more features in the car? I imagine power upgrades are going to be part of it, how about heated/cooled seats?
So can we expect the same crappy level of customer service / tech support that some IT companies deliver?
Just another example of the people who run SILLYCLONE VALLEY reaching their tenacles to spread themselves into another industry. They already have entertainment now automotive what’s next on their takeover list.
This will be an uphill battle for manufacturers. Charging on a regular basis for to access aspects of a vehicle that already costs $47k on average to “buy” is a no go for me. The next thing will be charging to remove annoying things like ads and fake noises from EVs. No thanks.
Absurd. A car is a self contained device. It already has all the capabilities it can have. This “business model” is to turn off those capabilities unless the owner pays a monthly ransom to get them back. I’d rather ride a horse than succumb to such idiocy. That said, I imagine the shysters will nonetheless make a crap ton of money off it.
I have personally developed subscription revenue models in high tech and transitioned customers from perpetual revenue models. However, I have difficulty envisioning any consumer benefit to Ford’s subscription revenue plans. I strongly suspect this is more about showing Wall Street a recurring revenue stream, which is the current fad relative to stock multiples times earnings. As they say, just follow the money. In this case the “why?” is likely stock based executive compensation.
This is the most despicable thing I’ve seen done by the auto industry. It’s not enough that they hold you upside down by the ankles and shake you at the point of sale and any time you use their overpriced service departments, now they have found a way to burrow into our wallets like parasitic ticks and drain off even more money, every month.
Dear Ford, and every other automaker looking at subscription services, shove it up your a&&! Remember when BMW tried this with Apple CarPlay? I wish you the same embarrassment.