Tesla Shifts Full Self-Driving Sales to Subscription-Only Model
Tesla is making a significant change in how it sells its Full Self-Driving (FSD) functionality. Starting February 14th, 2025, the company will transition to a subscription-only model for this feature. CEO Elon Musk announced that FSD, previously offered as a standalone package, will now only be available for a monthly fee.
Tesla’s Shift to Subscription Model
This decision comes as Tesla faces declining sales and uncertainty regarding its robotaxi strategy. The shift underscores a new approach to marketing FSD, a system Musk has often discussed as a step toward fully autonomous vehicles.
Price History of Full Self-Driving
- Initially priced at $15,000 as a one-time purchase
- Reduced to $12,000 and then dropped to $8,000
- Subscription model set at $99 per month
Musk’s recent financial incentives suggest that increasing the subscription base is crucial. He needs to acquire 10 million active subscribers to achieve a compensation package potentially worth up to $1 trillion. The urgency of this goal is highlighted by the company’s recent report indicating a 15.6 percent year-over-year decline in Q4 sales.
Current State of Robotaxi Services
Despite promises, the rollout of Tesla’s robotaxi service is still in development. Musk had projected that by 2025, half of the U.S. population would have access to these vehicles. However, currently, only a few company-owned cars are operational in limited areas like Austin and San Francisco, equipped with safety drivers.
These safety measures include a kill switch, which distinguishes Tesla’s service from competitors like Waymo. The company has not disclosed the current number of customers subscribed to FSD.
Challenges Ahead
Important hurdles remain for Tesla, particularly concerning older vehicle models. Cars lacking the latest computers will require retrofitting. Musk acknowledged that this process could be costly and complex.
Additionally, the marketing practices of Tesla have faced scrutiny. California’s Department of Motor Vehicles has accused the company of misleading customers regarding the capabilities of the FSD system, citing the need for driver supervision despite the “Full Self-Driving” label.
As Tesla navigates these challenges, the shift to a subscription-only model for Full Self-Driving represents a pivotal moment for the company’s future in automated vehicle technology.
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