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Tesla (NASDAQ:TSLA) dramatically lowered the monthly subscription price of its Full Self-Driving package to $99 per month from a prior rate of $199 per month in what appears to be a shift in strategy from the EV giant.
The electric vehicle maker recently required that all Tesla (TSLA) buyers taking delivery of a new vehicle take an FSD demo drive and offered existing Tesla (TSLA) owners one free month of the driver assistance system. The company also recently deployed FSD v12, which is powered by AI and has new features. The FSD upgrade is still far from full autonomy, and utilizes sensors in the steering wheel and cabin cameras to determine if a driver is attentive or not. Tesla (TSLA) itself now calls the package “FSD (Supervised)”.
At one time, Elon Musk promised that the FSD package would be an appreciating asset. “The FSD price will continue to rise as the software gets closer to full self-driving capability with regulatory approval,” tweeted Elon Musk in 2020.
Tesla (TSLA) now appears to be focusing on a high FSD take rate and building a large subscription business. Earlier in the week, Piper Sandler analysts Alexander Potter called FSD the crux of the bullish thesis on Tesla (TSLA). “Even when Tesla’s vehicle backlog was bursting at the seams, we think it was still impossible to own TSLA without assigning significant value to FSD software,” he noted.