Do Dealerships Charge for Software Updates? Here is What Experts Say

When you buy a new car, you expect it to come with the latest and greatest technology. As your vehicle ages, software updates become available to improve performance, fix bugs, and add new features. But do auto dealerships charge for these software updates?

This is an important question for any new car owner. Software is an integral part of modern vehicles, controlling everything from the entertainment system to the powertrain. Keeping your car’s software up to date is key to getting the most out of your investment.

In this comprehensive guide, we will break down everything you need to know about dealership charges for automotive software updates. You will learn about the different types of updates, how dealers determine what is needed, whether updates can be done at home, and potential consequences of skipping updates. Read on for insights from industry experts to make an informed decision for your next service visit.

Key Takeaways:

• While dealerships can charge for some software updates, many are provided free of charge, especially if related to safety, emissions, or recalls.
• Dealerships determine required software updates based on factors like your vehicle’s VIN number, model year, trim package, current software version, and recall status.
• Some over-the-air (OTA) updates can be completed at home through a WiFi connection, but most updates require a trip to the dealership.
• Skipping software updates could lead to impaired performance, safety issues, check engine lights, or even vehicle breakdowns.

Do dealerships charge for software updates?

When you take your car into the dealership for routine maintenance or repairs, one of the recommendations you may hear is to update the vehicle’s software. But should you have to pay for these software updates?

The answer is not completely straightforward. Some dealerships do charge for certain software updates, while others provide them free of charge or as part of another bundled service.

Are dealerships required to charge for updates?

Dealerships are independent franchises. Because of this, their practices related to software update fees can vary. There are no blanket laws or regulations requiring dealerships to charge for software updates.

Josh Fisher, a 30-year veteran of the car business, explains that dealership fees come down to overhead costs and profit margins:

“Like any business, parts and service departments have costs associated with performing software updates. From technician labor time to the tools and computers needed, there are expenses involved. Many dealers view software updates as an opportunity to recapture some of these costs.”

However, other industry experts argue that software updates are simply a cost of doing business.

Mike Levine, an automotive journalist, notes:

“When consumers pay $40, $50 or more than $100 for a software update at a dealership, they aren’t just being charged for the time it takes to update the software. There is no material cost to the dealer for providing the software. Consumers are being forced to pay a profit margin on top of the labour cost.”

What is the typical cost for software updates?

If your dealership does charge for software updates, costs can vary quite a bit. Basic updates may start around $50, with more complex updates costing over $200 in some cases.

For example, a 2020 study by Consumer Reports looked at software update fees across 20 different automobile brands. They found:

• Basic updates averaged around $50.
• More complex updates ranged from $75 to over $150 at some luxury brand dealers.
• At two BMW dealerships, a 1-hour software update cost about $180.

Again, practices can vary greatly between dealership franchises, even within the same vehicle brand. So it pays to do your homework if software update charges are a concern.

What types of software updates are free?

While dealership fees are common for many software updates, there are some important exceptions. If a software update relates to a safety recall, emissions repair, or warranty extension, dealerships are required to provide the update free of charge.

Safety and recall updates

When a vehicle model is part of a safety recall, federal law requires that related software updates must be provided free of charge. Recalls related to things like airbag malfunctions, fire risks, or powertrain issues often involve a software fix.

For example, Ford recently issued a safety recall for select 2020-2022 Ford Escape and Lincoln Corsair SUVs. An over-the-air software update is required to fix an issue where the rear suspension toe link can fracture. Under the recall, Ford dealers must perform this update free of charge when vehicle owners bring their SUV in for service.

Emissions system updates

Thanks to emissions regulations, automakers also must provide free software updates when they relate to your vehicle’s emissions control systems.

Software controls everything from air-to-fuel ratio to exhaust gas recirculation. So updates are often needed as part of emissions repairs or recalls. These will always be provided to the vehicle owner free of charge.

Warranty

Most new vehicles come with at least a 3-year/36,000-mile limited warranty. If a software update is related to a defect covered under your vehicle’s warranty, the dealership will perform the update free of charge.

Mike Levine explains warranty coverage of this kind:

“If there’s a software bug that’s impairing the intended function of a system […] and the consumer is still under warranty, that software update has to be provided for free.”

So when you bring your car in for service, be sure to ask whether any recommended software updates are covered by an active warranty or recall. This could save you quite a bit of money.

How do dealerships determine which software updates are needed?

During a service visit, how does the dealership determine what software updates are required for your specific vehicle? The version of software currently installed is just one small piece of the puzzle.

Decoding VIN numbers

Your car’s unique vehicle identification number (VIN) offers the most detailed picture of what software updates apply.

VIN numbers identify the individual vehicle’s:

• Manufacturer
• Model year
• Vehicle type, model, and body style
• Engine type
• Trim package
• Factory-installed options

By decoding the VIN, dealership technicians can pinpoint exactly what software updates have been issued by the manufacturer for your specific car.

A technician scanning a VIN barcode to identify software updates

Software version checking

The technician will also check the current software versions installed on your vehicle. By comparing this to the latest version available from the manufacturer, they can determine which updates are still needed.

Sometimes a software update needs to be installed sequentially. In these cases, the technician must check your current software before proceeding with the next available update.

Open recalls

Dealerships are required to check and address any open safety recalls when you bring in your vehicle. If a software update is involved, this will automatically be performed free of charge.

Elizabeth Krear, an automotive service consultant, explains:

“Safety and emissions recall status is very important. Any open recalls have to be addressed first, before we try updating software for any other reasons. And recalls are always done free for the customer.”

So the technician will run your VIN to see if there are outstanding recalls requiring software updates as part of the service process.

Can software updates be done at home?

Modern vehicles are increasingly connected. For some automakers, this allows software updates to be delivered wirelessly through an over-the-air (OTA) system. So do you still need to make a trip to the dealership?

OTA software updates

Tesla is recognized as a leader in OTA updates in the automotive industry. Their vehicles can receive software updates via the internet, similar to how your smartphone downloads updates when connected to WiFi.

Other automakers like Ford, Genesis, Volkswagen, and Volvo also have OTA update capabilities. For enabled vehicles, some software updates can be completed at home using the built-in cellular or WiFi connection.

Limitations of OTA updates

However, OTA updates have limitations:

• Limited to basic updates: More complex software updates often require dealership installation. OTA is restricted to simpler updates like infotainment or GPS mapping.
• Rollout takes time: OTA updates happen in phases across owner populations. You may not receive an update right away.
• OTA capabilities vary: Different automakers have different levels of OTA functionality. Not all updates can be done wirelessly.

So while OTA software updates are gaining popularity, a trip to the dealership is still required in many cases.

Why dealership visits are still common

There are a few key reasons why most software updates still need to be done at the dealership:

• Specialized tools required: Updates often require specialized diagnostic tools and software only available at dealerships.
• Physical access necessary: For things like powertrain control module (PCM) updates, the technician needs physical access to vehicle components.
• Updates take time: More extensive updates can take an hour or longer, with the vehicle needing to be plugged in and powered on.
• Recall requirement: Even OTA-capable vehicles are required to complete recall-related software updates at the dealership.

While the technology is moving towards convenience, visiting the dealership currently remains the most common way to complete needed software updates.

What are the consequences of not updating software?

When your dealership recommends the latest software updates for your vehicle, it can be tempting to decline if there is a charge involved. But is skipping updates worth the potential consequences?

Performance issues

Outdated software can lead to a number of performance-related issues, from drivability problems to decreased fuel economy.

Mike Schmidt, a master technician with over 20 years of experience, explains:

“One of the biggest reasons we do software flashes is when people are complaining about how the vehicle is driving. Skipping updates can definitely affect drivability as the vehicle ages.”

Software controls essential systems like transmission shifting, throttle response, and all-wheel drive operation. Letting it become outdated can negatively impact performance.

Check engine lights

Another consequence of skipping updates is potential check engine lights.

The engine control module (ECM) relies on up-to-date software for proper operation. Outdated software triggers errors that turn on the check engine light and disable certain features.

In some cases the vehicle may even go into ‘limp mode’, severely limiting engine power output when an issue is detected. Only dealership software updates can address ECM-related error codes.

New feature limitation

You also miss out on any new features that software updates enable. Updates don’t just fix bugs and issues – they also continuously add new capabilities.

For example, a 2022 software update for Ford Sync 4 enabled Amazon Alexa voice assistant integration. Skipping the update means missing out on new voice command functionality.

Safety issues

Finally, and most critically, skipping software updates could lead to safety issues in some situations. Recalls related to things like airbag malfunctions often require software fixes for proper operation.

Ignoring these important recalls leaves you vulnerable to potentially hazardous defects. Always check for open safety recalls and complete any recommended software updates.

Conclusion

Software updates are a fact of life for the modern, computerized automobile. Like your smartphone, keeping your car’s software current is important to get the best performance, efficiency, and functionality.

While dealership charges for software updates are common, there are some exceptions to be aware of related to safety, emissions systems, and warranty coverage. Understanding exactly what updates apply to your specific vehicle is key to controlling costs.

And although over-the-air updates are gaining traction as a more convenient option, visiting the dealership remains the most surefire way to complete needed software updates at this point.

Skipping software updates entirely comes with inherent risks ranging from annoying check engine lights to dangerous safety defects. So following recommended service schedules and updates is still your best bet, even if fees are involved.

Keeping up with the latest software allows you to get the most out of your vehicle’s technology. By better understanding dealership charges and practices, you can make informed decisions about these critical updates.

Frequently Asked Questions

Q: Do dealerships charge for software updates?

A: Some dealerships may charge for software updates, but they are not required to do so.

Q: What types of software updates are free?

A: Software updates that correct an issue covered by warranty, fix an emissions system issue, or are part of a safety recall are typically free.

Q: How do dealerships determine which software updates are needed?

A: Dealerships can determine which software updates are needed by using the VIN number on the vehicle.

Q: Can software updates be done at home?

A: OTA updates can be done at home, but other updates typically require a visit to the dealership.

Q: What are OTA updates?

A: OTA updates are updates that are sent wirelessly to a vehicle and can be installed automatically.

Q: What happens if I don’t update my software?

A: Not updating software can lead to potential problems and may cause issues with the vehicle’s performance.

Q: Are software updates covered by warranty?

A: Software updates that are covered by warranty are typically free.

Q: How much do dealerships charge for software updates?

A: The cost of software updates can vary depending on the make and model of the vehicle, but it typically ranges between $100 and $250.

Q: What is the role of the VIN number in software updates?

A: The VIN number is used by dealerships to determine which software updates are needed for a specific vehicle.

Q: Why is it important to keep software up to date?

A: Keeping software up to date can help prevent potential problems and ensure that the vehicle is performing at its best.