Musk ends one time purchase model
Tesla will stop selling its Full Self-Driving (Supervised) software as a one time purchase and will offer the feature exclusively through a monthly subscription, according to Chief Executive Officer Elon Musk. The change will take effect after mid February, marking a significant shift in how the electric vehicle maker monetizes one of its most strategic technologies.
The Full Self-Driving package, currently priced at $99 per month, had previously been available for a flat fee of $8,000. Musk announced the decision in a post on social media, emphasizing that subscriptions will be the sole option going forward. Tesla shares closed lower following the announcement.
Autonomy at the core of Tesla’s strategy
Full Self-Driving remains central to Tesla’s long term vision as the company seeks to position itself as a leader in autonomous mobility. Musk has repeatedly highlighted autonomy as a key driver of future revenue, particularly through robotaxi services and ride hailing.
Tesla has already launched a limited robotaxi service in Austin, Texas, and operates ride hailing in San Francisco with a safety driver behind the wheel. However, the company does not disclose how many customers actively subscribe to or use the Full Self-Driving software.
Competition intensifies in driverless services
Tesla continues to trail rivals in fully autonomous deployment. Alphabet’s Waymo has expanded rapidly and now records hundreds of thousands of paid driverless rides each week across multiple U.S. cities. Waymo is also planning further expansion in the coming year, underscoring the competitive pressure Tesla faces in the autonomous vehicle space.
The move to a subscription only model could provide Tesla with more predictable recurring revenue, but it also removes the upfront purchase option that some customers preferred. Analysts are watching closely to see whether the change boosts long term adoption or limits appeal among cost conscious buyers.
Broader challenges for the EV maker
The announcement comes as Tesla navigates a challenging period for its core electric vehicle business. The company recently reported a second consecutive annual decline in deliveries, with fourth quarter figures showing a sharp drop compared with the previous year. Production also declined year over year, reflecting softer demand in key markets.
Tesla is scheduled to report its fourth quarter earnings later this month, with investors expected to scrutinize both vehicle margins and progress on autonomy. The shift to subscription based Full Self-Driving adds another layer to the company’s evolving business model as it balances near term sales pressures with long term ambitions in artificial intelligence and mobility.
