Would You Buy OnStar From A Dealer Or Best Buy?

August 12, 2011
OnStar FMV

OnStar FMV

Earlier this year, General Motors announced plans to sell OnStar as an aftermarket system called OnStar FMV (or "For My Vehicle"). The company recently made good on its promise, shipping OnStar FMV kits to select dealerships across the country, as well as other shops like Best Buy.

Which raises at least two interesting questions. First: what effect is this going to have on GM's bottom line? Previously, customers could only purchase OnStar directly from GM. It came as a factory-installed option, meaning that all the dough shoppers paid -- as well as those tidy subscription fees -- went straight to Detroit. Will GM suffer from the loss of hardware sales? Or is OnStar, like mobile phones and Keurig coffee machines, hardware that's practically given away to generate revenue from subscriptions? (We're guessing the latter.)

Question number two is for you: where would you buy OnStar? Here are some options, with a few pros and cons for each:

A. From a dealer, pre-installed
Pro: It requires no extra trip to the dealer, no waiting around for installation: the hardware is loaded and ready to go when you drive off the lot.
Con: The dealer makes no money from the hardware purchase or installation, which might bother people who have built relationships with their preferred dealer.

B. From a dealer, aftermarket 
Pro: Consumers might be more comfortable buying hardware from the same outlet that sells them their vehicle.
Con:  Dealers aren't always in a convenient location.

C. From a big-box retailer like Best Buy
Pro: The location is bound to be convenient. (Seriously, those shops are everywhere.) The purchase price could be cheaper, since chains buy in bulk.
Con: Some consumers might be worried about letting a non-car company install something on their cars (even though Best Buy and others install plenty of car stereos).

D. Nowhere
Pro: Well, it's cheaper.
Con: You'll miss out on some of OnStar's great features (though many of those can be acquired from other sources nowadays).

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