Tesla Retires Autopilot, Introduces $99/Month Lane-Keeping Feature
Tesla has recently announced significant changes regarding its Autopilot feature. This shift comes as the automaker faces pressure regarding its marketing practices in California, a crucial market for the company.
Tesla’s Changes to Autopilot Feature
Effective immediately, Tesla has retired the traditional Autopilot feature. The change is in response to concerns that the existing marketing may have been misleading.
Subscription-Based Lane-Keeping Feature
From mid-February, Tesla introduces a new $99/month subscription for its lane-keeping capabilities, dubbed Full Self-Driving (FSD). Until then, customers can opt for a one-time fee of $8,000 to access this feature.
- Initial Fee: $8,000 until mid-February.
- Subscription Fee: $99 per month starting February 14.
Elon Musk stated that the subscription price will increase as the capabilities of FSD improve. He noted that significant value would be realized when an unsupervised version allows for activities such as using a phone or sleeping during the ride.
The Shift in Automotive Revenue Models
This change reflects a broader trend in the automotive industry, where manufacturers seek recurring revenue streams. Traditionally, consumers have viewed these products as one-time purchases. Now, companies are exploring subscription services to enhance revenue stability.
- General Motors: Dropped Apple CarPlay and Android Automotive.
- BMW: Experimented with various subscription models.
Despite Tesla’s current high stock prices, the declining profit margins and sales, coupled with the loss of emissions credits, make consistent cash flow from subscriptions appealing. This strategy signifies Tesla’s adaptation to market demands and investor expectations.
