Tesla (TSLA) has dropped the price of its Full Self-Driving (FSD) Capability package from $12,000 to $8,000.
The automaker updated its online car configurator and mobile app just a few hours ago to reflect the new FSD pricing that is reduced by $4,000.
Tesla reduced the price of the FSD monthly subscription from $199/mo to $99/mo a few weeks ago. This price cut came after the automaker introduced a 1-month free trial of the self-driving software (still ADAS).
Tesla suddenly dropping the price of the Full Self-Driving Capability package is shocking but understandable. With this year’s drop in car deliveries and automotive revenue, the automaker needs to open more revenue streams besides vehicle sales.
Interestingly, the vehicle price drop on Friday and Autopilot FSD price reduction yesterday evening came just a few days before Tesla’s Q1 2024 earnings call. Tesla CEO Elon Musk will be explaining the reasoning and effects of these price adjustments on the call and it will be worth listening to his commentary.
Before dropping the price of FSD Capability today, Tesla had two packages in the Autopilot section, Enhanced Autopilot (EAP) and Full Self-Driving (FSD) Capability. EAP had all the basic features of Autopilot and was priced at $6,000 — half the price of the FSD Capability package.
With the introduction of the reduced price of the FSD package, Tesla has now removed Enhanced Autopilot entirely from the car configurator and mobile app. The only option that remains is Full Self-Driving Capability priced at $8,000.
Tesla owners who already owned Enhanced Autopilot report that they are seeing the price of Full Self-Driving Capability as $2,000 in their Tesla account. Tesla is giving EAP an even reduced price by adjusting the amount of $6,000 they have already paid.
The new FSD Capability includes all of the following features:
- Navigate on Autopilot
- Auto Lane Change
- Autopark
- Summon
- Smart Summon
- Autosteer on city streets
- Traffic Light and Stop Sign Control
With the recent success with FSD (Supervised) v12 updates, Tesla has gained more confidence in the capabilities of its self-driving technology. The automaker will be pitching the improvements and reduced prices of the Full Self-Driving tech during the upcoming Q1 earnings call.
Tesla’s FSD price reduction coupled with the progress in autonomous street driving puts Tesla (TSLA) in a position to attract new sales. A large number of existing Tesla owners in the United States and Canada might buy the more affordable Full Self-Driving Capability as it’s becoming more useful by the day.
A 2018 Tesla Model 3 owner shared his experience on Reddi:
I have a 2018 Model 3, had EAP initially, and bought FSD for $2k years back.
It wasn’t really worth it for a long time, but with FSD 12.3 it has become well worth it. Vast majority of my city street driving is now with FSD.
This change in views about Tesla Autopilot is exactly in line with Elon Musk’s thoughts he has shared for the past few years. He said that with time the value of Autopilot/FSD will increase as the technology gets closer and closer to fully autonomous driving.
The recent drop in sales, global inflation, and rising competition have pushed Tesla to lower the price of the Full Self-Driving Capability. However, this might be a temporary price drop. As soon as the situation stabilizes at the company and Autopilot gains more capabilities, Tesla might raise the FSD price to even more than what it previously was, i.e. $12,000.
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