Tesla Ditches One-Time FSD Purchase for Subscription-Only Model
Overview
Tesla CEO Elon Musk announced the electric automaker will exclusively offer its Full Self-Driving (FSD) software via a monthly subscription starting February 14. This move eliminates the option for a one-time purchase of the advanced driver-assistance system, which currently costs $8,000. The FSD system, which requires driver supervision, is under ongoing investigation by U.S. regulators.
Tesla CEO Elon Musk declared Wednesday that the electric vehicle manufacturer's advanced Full Self-Driving (FSD) software will transition exclusively to a monthly subscription model after February 14. This marks a significant strategic shift for the company's software offerings.
Currently, Tesla offers FSD (Supervised) for a one-time payment of $8,000 in the U.S., alongside a $99 monthly subscription. The FSD system is classified as an assistance system, demanding constant driver attention and readiness to intervene.
The announcement comes amid heightened scrutiny from regulators. The U.S. National Highway Traffic Safety Administration (NHTSA) launched an investigation last year into 2.88 million Tesla vehicles equipped with FSD. This probe is based on over 50 reports of safety violations and a series of crashes involving the system.
Subscription Model Dominance
The elimination of the one-time purchase option aims to streamline Tesla's revenue streams, favoring recurring income over large upfront payments. This approach could boost predictable revenue but may impact initial adoption rates among consumers hesitant about long-term commitments or ongoing costs.
Regulatory Cloud Looms
Tesla has appended the term "Supervised" to its FSD offering in passenger vehicles, emphasizing the need for human oversight. An unsupervised variant is reportedly used internally for moving cars on factory assembly lines and delivery lots. The NHTSA's investigation scrutinizes the system's safety performance, particularly its ability to prevent crashes and adhere to traffic laws.
Understanding Tesla's Software
Tesla's Autopilot feature assists drivers with acceleration, braking, and lane-keeping on highways. Full Self-Driving expands these capabilities to include automatic lane changes and navigation of city streets, including obeying traffic signals. Despite the advanced features, both systems require active driver engagement.
