Tesla has once more lowered the price of its Full Self-Driving software by $4,000, now costing $8,000, down from a previous price of $12,000 within the US.
Prices were also lowered in Canada, where the system used to cost $16,000CAD, and now costs $11,000CAD.
In addition to the price drop, Tesla has eliminated “Enhanced Autopilot” as an option, which previously cost $6,000. For owners who have already got enhanced autopilot, the price to upgrade to FSD is now $2,000, down from $6,000.
Tesla has been doing quite a bit of price cuts recently, including dropping the price of most of its vehicles by $2,000 only a day ago.
It also cut the price of its FSD subscription service in half, to $99/mo, just a pair weeks ago.
That latest subscription price suddenly made FSD’s $12k price seem quite steep, as someone would want to subscribe to FSD for ten whole years before paying $12k in total cost – and that’s not including the time value of money.
So it seemed inevitable that individuals would lean towards subscriptions, somewhat than upfront purchases, after that price drop.
Now, to make the costs slightly closer, Tesla dropped the price of FSD to $8,000 – or 6 2/3 years price of subscriptions at $99/mo. A bit more reasonable, though still longer than many individuals own a automobile (and, again, one should account for the time value of money).
All of these prices are down significantly from the very best price FSD has ever sold for, which was $15k from late 2022 until late 2023 when it dropped the price back to $12k.
Tesla CEO Elon Musk has repeatedly said that as FSD becomes more capable, it must also go up in price to reflect its greater value. Previously, FSD price increases were largely related to software updates that added latest capability to the system.
Musk even went so far as to say that this implies Tesla cars with FSD are “appreciating assets,” potentially price $100-200k due to their value as robotaxis. Though Tesla only uses those values when it’s convenient, considering FSD much less beneficial when offering trade-in estimates to owners.
But on a more practical business level, this move to lower FSD prices probably has less to do with the system’s capabilities and more to do with boosting revenue during a difficult time for the corporate, having just posted bad quarterly delivery numbers and shedding 10% of its workforce. A lower price could incentivize owners to pony up for software which had previously mostly gone up in price, giving Tesla a free money infusion.
The system’s capabilities have been changing, too. Tesla has been pushing FSD more recently, ever because the release of the “mind-blowing” FSD v12. The new edition changes the system significantly on the back-end, finally using machine learning neural nets to analyze Tesla’s vast amounts of driving data to teach cars how to drive themselves.
With Tesla’s confidence in the brand new system, the corporate rolled out a free one-month trial of FSD to all Teslas within the US, principally encompassing the month of April.
It has also began calling the system “Supervised Full Self-Driving,” a somewhat self-contradictory name that nevertheless is more accurate on condition that FSD remains to be a “Level 2” system that doesn’t ever actually take full responsibility for the dynamic driving task (that only happens with level 3+ systems, like Mercedes’ DRIVE PILOT or Waymo).
Today’s price drop hasn’t been echoed in all other territories. It’s still listed at £6,800 within the UK and 59,600kr in Norway, same because it was before today’s price drop. FSD has generally been somewhat cheaper in Europe than the US after bearing in mind exchange rates, since it also has more capabilities within the US than in other countries, but after today’s price cuts, it’s actually costlier in some EU countries (just like the UK, where exchange rate puts it at ~$8.4k USD equivalent) than within the US, despite lower capabilities.
Credit : electrek.co