Blog: Simple things (2)
Dave Leggett | 26 September 2003
One is the problem of 'de-bugging' that comes with these new wonders. Problems with Mercedes-Benz's 'Comand', which integrates the on-board satellite navigation, entertainment system and phone, forced Mercedes to buy back 2,000 E-class saloons from US customers. The quality glitches also created tensions with Bosch, a key Mercedes supplier. So maybe there are issues for the car companies to consider when introducing this cutting edge stuff.
On the demand-side, an issue of some import has to be this fundamental question: does the customer really want it and how much will the customer pay? The latest survey of European consumers carried out by JD Power is revealing. For example, some 75% of European survey respondents express a strong interest in a navigation system on their next new vehicle before they know the mid-point price for the feature. After the price is introduced, only 26% of respondents are still interested.
Maybe these features will proliferate in new models on a 'me too' basis, or as a way of adding value at low cost - but that suggests making money on these telematics offerings is perhaps going to be difficult for longer than its champions and manufacturers would like.
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