Tesla will no longer sell its Full Self-Driving (Supervised) driver assistance software as a one-time purchase, CEO Elon Musk announced Wednesday. Starting February 14, the system will be available only through a monthly subscription model.
Previously, Tesla offered the software for a flat fee—most recently $8,000, down from a peak of $15,000 in 2022. A subscription option launched in 2021 at $199 per month, before dropping in 2024 to $99 per month.
Tesla has not said whether pricing will change under the subscription-only model. Musk has not provided a reason for eliminating the one-time fee option, though Tesla executives have noted lower-than-expected adoption rates. In October 2023, Chief Financial Officer Vaibhav Taneja said 12% of Tesla owners had purchased Full Self-Driving.
Switching to subscriptions could make the software more accessible and potentially increase adoption, as Tesla faces expected challenges in the first quarter of 2024.
Increasing subscriptions also aligns with one of the performance targets tied to Musk’s compensation plan, which includes reaching 10 million active Full Self-Driving subscriptions measured daily over a three-month period by 2035.
The change could also help Tesla address ongoing legal challenges. Over the past decade, Tesla has marketed its vehicles as having hardware capable of full autonomy, pending software improvements. However, many vehicles, especially those with “Hardware 3,” may require additional upgrades, according to Musk.
In December, a California judge ruled Tesla engaged in deceptive marketing related to both Full Self-Driving and its Autopilot system. The state’s Department of Motor Vehicles was authorized to suspend Tesla’s manufacturing and dealer licenses for 30 days. That suspension is currently on hold as Tesla has at least 60 days to rename the products or update their capabilities.
Tesla also faces class-action lawsuits over past claims about its vehicles’ autonomous potential. By ending the one-time purchase model, Tesla may limit its liability if such cases proceed to trial.
While Tesla’s Full Self-Driving remains among the most advanced driver-assistance systems in the U.S., competition is increasing. Rivian has expanded its hands-free features, and Ford and General Motors offer similar technologies. Multiple Chinese automakers are also advancing their driver assistance systems, with some now included as standard features.
