Tesla's FSD to Be Subscription-Exclusive, Says Musk

In a move aimed at boosting adoption, Elon Musk revealed that Tesla will cease offering its Full Self-Driving (FSD) feature for a one-time payment. Instead, from February 14 onwards, it will only be accessible through a subscription model.

Previously, Tesla owners could choose to pay a hefty $8,000 upfront to permanently equip their vehicles with FSD or opt for a less financially demanding monthly fee of $99. However, the company has been battling to persuade a significant portion of its customer base to invest in this technology, deemed by Musk as vital for the automaker's long-term strategy.

In the most recent quarterly earnings briefing held in October, Tesla's Chief Financial Officer shared with investors that merely 12% of the company's vehicles have subscribed to the FSD service. Moreover, this segment of the business observed a decline in revenue compared to the prior year.

Securing a substantial increase in FSD subscriptions forms an integral part of the ambitious compensation plan approved for Musk. To unlock the full $1 trillion package, Tesla must achieve a milestone of 10 million FSD subscriptions.

Compliance Challenges and Legal Hurdles

Despite its promising capabilities—allowing vehicles to operate autonomously under human supervision—FSD has encountered significant scrutiny from regulatory bodies. The National Highway Traffic Safety Administration has launched probes into Tesla's accident reporting practices concerning FSD, alongside concerns about incidents where FSD vehicles reportedly breached traffic regulations by running red lights and wrong-way driving.

Adding further to Tesla’s challenges, a California court has issued a ruling that could impact the sales of Tesla vehicles in the state, as allegations surfaced claiming misleading marketing tactics surrounding FSD and Autopilot features.

As of now, Tesla has remained silent on these issues, declining to comment despite repeated media inquiries.