Tesla is shifting gears on how it sells its self-driving software. On Tuesday evening, CEO Elon Musk confirmed that Tesla will stop offering Full Self-Driving (FSD) as a one-time purchase after February 14.
Starting the next day, the only way to get the advanced driver-assistance system will be through a monthly subscription, reports Tesla North.
For Canadian owners, this means the current $11,000 CAD upfront price is going away. From February 15 onward, the feature will be available for the current $99 CAD per month pricing in Canada. Our American neighbours down south have an annual $999 US option, that we don’t have yet here. It’s unclear if pricing will change after that deadline. A lower monthly pricing may encourage even higher adoption.
This moves FSD from being a permanent asset tied to the car to a software-as-a-service model, similar to Netflix or Spotify. By ditching the heavy upfront cost, Tesla significantly lowers the barrier to entry. Owners can now turn the feature on for a single month (such as for road trips) and cancel it when they are done.
For Tesla, the move creates a steady stream of recurring revenue. It also directly helps Elon Musk hit a major milestone in his recently approved $1 trillion compensation plan, which requires the company to reach 10 million active FSD subscribers over the next decade.
If you have already paid for the lifetime FSD package for your car, your access is safe. Another advantage of a subscription model is FSD is no longer tied to a specific car and can shift with owners to their next car. It also will allow for more service revenue from owners, akin to what Apple is doing through all of its services such as iCloud, Apple Music and more.
The timing is notable as FSD enters a more advanced stage (14.2 and newer has impressed testers saying it feels “sentient”), with the company actively testing its robotaxis in Austin, Texas (Cybercab mass production also recently started). Tesla is currently testing an “unsupervised” FSD, and recent updates have even begun allowing drivers to perform tasks like texting while behind the wheel under specific supervised conditions.
Tesla also recently launched a more affordable and stripped down Model Y Standard in Canada, starting from $49,990 CAD, which seemingly presents itself as the cheapest way to start using FSD.
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