What Was the 'Car Thing' Anyway?
First launched to the public in February 2022, the Car Thing was a sleek, $90 dashboard-mounted accessory designed for one job: to make using Spotify in the car seamless. With a responsive touchscreen, a satisfying physical dial, and voice commands, it gave
users a dedicated controller for their music and podcasts. It was especially aimed at drivers with older vehicles that lacked modern infotainment systems like Apple CarPlay or Android Auto. The initial buzz was significant, with a waitlist that reportedly topped two million people. While calling it a "best-seller" might be a stretch—it was Spotify's only hardware product—it certainly had a passionate, if niche, following. For a moment, it looked like a clever bridge between your phone and your car stereo.
The High Cost of Physical Goods
The first problem was simple: hardware is hard. For a company built on software and streaming licenses, the world of manufacturing, supply chains, and component costs is a different beast entirely. Spotify quickly ran into the harsh realities of this world. In mid-2022, just five months after the public launch, the company announced it was halting production. Officials cited rising inflation and supply chain issues that made the device no longer financially viable at its price point. The experiment ended up costing Spotify a reported $31 million write-down. Unlike a software update, you can't just email a physical product to a customer. The costs of making, shipping, and supporting a gadget were a constant drain, a far cry from the infinitely scalable world of digital streaming.
A Niche Product in a Shrinking Market
Beyond the manufacturing headaches, the Car Thing faced a shrinking addressable market. Its ideal customer owned a car old enough not to have a built-in infotainment screen but new enough to have a Bluetooth or auxiliary connection. More importantly, the user had to be a Spotify Premium subscriber. As more new cars roll off the lot with CarPlay and Android Auto as standard, and as drivers become more accustomed to using their phones for everything, the need for a dedicated, single-function device dwindled. It was a solution for a problem that, for many people, was already solved by the supercomputer in their pocket. Spotify realized it had built a niche product for a user base that was destined to shrink over time.
The Real Goal: Focusing the Business
Ultimately, killing the Car Thing was a deliberate strategic choice to refocus the company. Spotify's leadership is on a mission to achieve consistent profitability, which means doubling down on its core strengths: music streaming, podcasts, audiobooks, and the advertising that supports them. The Car Thing was a distraction—a costly side quest in a much bigger game. By discontinuing the device and eventually rendering all units inoperable in December 2024, Spotify sent a clear message: we are a software and services company, not a hardware company. The move allows the company to pour its resources into improving the app, refining its powerful recommendation algorithms, and expanding its audio empire, rather than troubleshooting a physical gadget.
