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Tesla drops price of ‘Full Self-Driving’ to $8,000, down from $12,000

Vaseline 1 month ago

Tesla has again reduced the price of its Full Self-Driving software by $4,000, which now costs $8,000, compared to a previous price of $12,000 in the US.

Prices were also reduced in Canada, where the system previously cost $16,000CAD and now costs $11,000CAD.

In addition to the price drop, Tesla has eliminated the “Enhanced Autopilot” option, which previously cost $6,000. For owners who already have an upgraded autopilot, the cost to upgrade to FSD is now $2,000, down from $6,000.

Tesla has been making a lot of price cuts lately, including cutting the price of most of its vehicles by $2,000 a day ago.

It also cut the price of its FSD subscription service in half to $99 per month a few weeks ago.

That new subscription price suddenly made the $12,000 price for FSD seem quite high, because someone would have to subscribe to FSD ten whole years before paying $12,000 in total costs – and that doesn’t include the time value of money.

So it seemed inevitable that after that price drop, people would gravitate towards subscriptions rather than upfront purchases.

To bring prices closer together, Tesla has dropped the price of FSD to $8,000 – or 6 2/3 years of $99/month subscriptions. Slightly more reasonable, but still longer than many people will own a car (and again, you have to consider the time value of money).

All of these prices are down significantly from the highest price FSD has ever sold for, which was $15,000 from late 2022 to late 2023, when the price dropped to $12,000.

Tesla CEO Elon Musk has repeatedly said that as FSD becomes more capable, it should also increase in price to reflect its greater value. Previously, FSD price increases were largely associated with software updates that added new capabilities to the system.

Musk even went so far as to say that this means Tesla cars with FSD are “asset appreciating,” potentially worth $100-200,000 due to their value as robotaxis. While Tesla only uses these values ​​when it’s convenient, FSD considers them much less valuable when offering trade-in estimates to owners.

But on a more practical business level, this move to lower FSD prices likely has less to do with the system’s capabilities and more to do with increasing sales at a difficult time for the company, having just posted poor quarterly delivery numbers and 10 % had to fire. of its workforce. A lower price could encourage owners to buy software that had previously largely gone up in price, giving Tesla a free cash injection.

The capabilities of the system have also changed. Tesla has been pushing FSD more and more lately, since the release of the “stunning” FSD v12. The new version changes the system significantly on the back end, ultimately 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 new system, the company introduced a one-month free trial of FSD to all Teslas in the US, which basically covered the month of April.

The company has also started calling the system ‘Supervised Full Self-Driving’, a somewhat contradictory name that is nevertheless more accurate as FSD is still a ‘Level 2′ system that never actually takes full responsibility for the dynamic driving task . (this only happens with level 3+ systems, such as Mercedes’ DRIVE PILOT or Waymo).

Today’s price drop has not been echoed in all other areas. It is still listed at £6,800 in the UK and 59,600 kr in Norway, the same as before today’s price drop. FSD has generally been slightly cheaper in Europe than the US, taking into account exchange rates, as it also has more features in the US than in other countries, but after the current price cuts it has become increasingly popular in some EU countries (such as the UK ) even more expensive (where the exchange rate puts the equivalent at ~$8.4k USD equivalent) than in the US, despite lower options.

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