Toyota and Lexus are teaming up with SiriusXM to offer a three-year audio package for a single payment, easing customer frustration with consistent monthly subscription fees.
Dealers in the U.S. will be able to order vehicles with the longer subscription option, and customers will pay upfront for the bundled service. Otherwise, a vehicle will have the standard 3-month complimentary trial, which gives customers the ability to subscribe for a monthly fee.
“This gives dealers another opportunity to customize the vehicle for their local market,” Brandon Olszewski, Toyota’s connected product and services manager, told Automotive News. “Customers have been telling us for several years that they prefer to pay for vehicle options up front.”
SiriusXM provides hundreds of channels, featuring music, talk shows and sports, and is estimated to reach about 150 million listeners monthly, according to the company’s 10-K filing.
About 160 million vehicles in operation have SiriusXM radios, which they have the option to subscribe to, and the in-vehicle platform is available in 80% of new vehicles sold in the U.S., including brands like Subaru, Jeep and Hyundai.
The cost of 33 months of SiriusXM service in a Toyota or Lexus vehicle is $350 and will roll out across all but five new vehicle models, Olszewski said. SiriusXM’s main source of revenue is subscription fees, and as of December 2023, nearly 34 million customers were signed up for its service.
While many music subscription apps can connect to vehicle speaker systems via Bluetooth or an auxiliary cable, Olszewski said SiriusXM’s exclusively curated playlists enhance the in-car audio experience.
“Live sports is another important area where SiriusXM sees very strong interest,” he said. Toyota customers often continue their SiriusXM subscription after the three-month free trial ends, indicating a strong interest in a long-term commitment to its services, Olszewski said.
SiriusXM also provides additional data-driven features, including weather updates, fuel prices, sports programming, movie listings and traffic information. In 2023, it updated its digital infrastructure, introducing an updated mobile app compatible with in-car systems like Apple CarPlay to reach younger users, who make up 25% of the listener market.
Toyota and Lexus recently launched their own Connected Services platform, allowing owners to start and stop the vehicle, lock and unlock doors and access the navigation system remotely with a three-year subscription model.
“This program has been quite successful, giving us additional validation that this business model is something the market is asking for,” Olszewski said.