Are AI and Connected Services in Cars Worth It?

Key Points

• The automotive industry is pivoting to software-defined vehicles, which use over-the-air updates and integrate functions into software rather than hardware. 
• Connected cars can allow automakers to collect and sell extensive vehicle data, such as geolocation, speed and driver behavior.
• Some automakers are also integrating artificial intelligence into vehicle infotainment systems.
• Some features in connected vehicles, such as heated seats or remote start, may also be digitally locked, requiring consumers to pay a monthly fee to access them. 

As vehicles have more technology in them than ever before, letting drivers and passengers alike stay connected with everything from wireless internet service to in-vehicle app stores, we’re starting to venture into uncharted territory. Some vehicles have even started to introduce artificial intelligence assistants. But one looming question hangs over all of this technology: Is any of it worth it?

Related: How to Keep Your Car From Sharing Your Sensitive Data Behind Your Back

Software-Defined Vehicles Are the Key

• Takeaway: Automakers are pivoting to vehicles that are dependent on software rather than physical hardware. 

For the last few years, automakers have started preparing to introduce vehicles that are software-defined. Electric vehicles in particular have helped usher in this new automotive world. Much like devices including iPhones and tablets, these software-defined vehicles allow automakers to offer things like over-the-air updates and connected services that many in the industry believe are advantageous to consumers as they’ll make vehicles perform better and have greater safety and convenience features. 

For instance, owners of EVs from brands such as Cadillac and Kia can improve their car’s performance by paying extra to unlock more power. Consumers can even purchase features like interior themes and special lighting sequences for their vehicles from in-vehicle app stores. Over-the-air updates can also add critical features or updates to vehicle systems so they can function properly. In some instances, automakers are going even further with these software-defined features.

The Introduction of AI in Vehicles

• Takeaway: In-vehicle AI assistants are one merely part of the next generation of software-defined vehicles. 

AI is starting to arrive in some models in the form of assistants built into the vehicle’s infotainment system, allowing drivers to ask questions, collaborate and brainstorm with AI while behind the wheel. 

For example, Amazon Alexa has been offered in numerous models since the early 2020s, and Polestar recently announced it would be integrating Google’s Gemini AI voice assistant in all of its models beginning in 2026. Even ChatGPT is making its way into vehicles, as Volkswagen started offering the AI assistant in its vehicles for the 2024 ID.4 and 2025 Jetta. As AI continues to boom, we can expect to see AI assistants offered in even more cars across a wider reach of brands. 

Privacy Concerns

Takeaways:

• All of this technology allows automakers to gather and store vehicle data.
• Everything from vehicle location data to vehicle speed is stored and often analyzed by automakers. 

Ultimately, these connected features and services are about gathering vehicle data, which automakers keep and analyze — and sometimes, the data are collected and used in disturbing ways. Honda for instance, collects data on the vehicle’s geo location, engine performance and even driver behavior. 

Sometimes this data can be used as an excuse to void warranties, too. In mid-2024, Toyota denied warranty claims of some GR Corolla owners after engine fires destroyed their cars. Vehicle data the company gathered claimed to show that the drivers had “abused” their cars by either speeding or over revving the engines even though there was no proof they did. 

Automakers also can use this data to sell you out to insurance companies. A New York Times report from July 2024 showed that automakers such as GM, Honda and Hyundai had sold vehicle data information to insurance companies for pennies. The data collected included how hard a vehicle braked and how often drivers exceeded the speed limit — information that could potentially be used to increase insurance premiums. 

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Is Any of This Worth It?

Takeaways:

• Software-defined vehicles look to keep owners in their respective automaker’s ecosystems on the assumption that people will pay a subscription for connected services.
• These vehicles also seem to be leading to troubles like in-vehicle advertising.

This all sounds great, right? Software will help people update their vehicles, unlock cool features, lower repair costs (at least for EVs) or even allow you to have an AI assistant in your car. But look past the surface, and this future of software-driven vehicles isn’t as rosy as it seems. 

Put bluntly, this is all about money. Automakers bet big on EVs, investing billions in the hope that Americans would buy them and usher in the next generation of the automobile. However, those EVs are made with fewer moving parts to service and less revenue coming in from streams like dealer servicing. To make up for this, automakers have started to think bigger, leading to — you guessed it — software-defined vehicles. 

These vehicles open up a whole new world of revenue streams for automakers, which some industry analysts are saying could be worth as much as $1.2 trillion in the next decade. The main moneymaker for manufacturers likely will come from subscription-based services and features. Despite data showing that consumers dislike these kinds of features, automakers have begun rolling them out. Some features make sense with this kind of thing, such as hands-free driving tech like Ford’s BlueCruise and GM’s Super Cruise, but other features may be a way for automakers to nickel and dime consumers. 

For instance, Audi and BMW caused uproar a few years ago as both luxury brands wanted consumers to open their wallets and pay for things the vehicles should already come equipped with. Audi elected to keep these features in Europe (where A3 buyers will have to pay to unlock features such as heated seats and dual-zone climate control) for the time being; on the other hand, BMW went ahead with offering these features to buyers in the U.S., as the German brand has over $5 billion in potential revenue on the line. Features like driving and parking assistance features, remote start and cameras can either be paid for monthly or in three-year intervals. 

What’s bad about this software-defined future we’re heading into? The main problem is that software-defined vehicles give automakers a way to digitally lock features that either should come equipped with the car outright or are available in option packages, forcing you, the consumer, to open your wallet and pay extra if you want them. This is made worse with some brands, such as BMW and Kia, as not only do you have to pay for these features, you also have to pay extra to unlock the digital store to pay for the subscription; in addition to a free plan that gets you hardly anything, Kia has three different plans that range from $59-$199 annually that you have to subscribe to before you can get more features. 

These vehicles also require a network cellular signal to stay connected. In many parts of the country, this is a problem since rural areas either have a lack of network coverage or no coverage at all. Things get murky when automakers make the argument that software-defined vehicles can help with safety; what happens when those very safety and emergency features can’t be used because of signal connectivity? This is all a problem that is still being worked on by automakers, with some proposing fixes including larger vehicle antennas and low-orbit satellites. 

Software-defined vehicles also have seemed to open a door to direct targeted advertising in vehicles. Recently, images have begun circulating online showing owners of Jeep vehicles with pop-up ads for extended warranties and new vehicle incentives on their infotainment screens. Stellantis is framing these ads as notifications, with a company spokesperson saying it’s more to keep customers up to date about things such as safety alerts and recalls. Customers can opt out of the messages, but they have to call a customer care line to do so, and even if they’re able to opt out, the issue is that the ads exist in the first place. And with software-defined vehicles set to take over a majority of cars, these instances may get more frequent. 

We reached out to both BMW and Kia for comments, but neither brand has yet responded at the time of this writing. We’ll update this article when we receive a reply.

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