Tesla confirms self-driving as a subscription service but brace yourself for the price

Tesla has confirmed that it will offer its Full Self-Driving package (FSD) as a subscription service, but you should brace yourself for the price.

We reported earlier this week that Tesla is working on a pay-as-you-go subscription for its self-driving package based on some code that leaked in Tesla’s in-app purchase system.

During a conference call following Tesla’s Q1 2020 results, CEO Elon Musk and CFO Zachary Kirkhorn that Tesla plans to offer the package as a subscription service by the end of the year.

Musk said:

“I think we will offer Full Self-Driving as a subscription service, but it will be probably towards the end of this year.”

However, both Musk and Kirkhorn emphasized that it will make more sense financially to buy the feature than to subscribe to it:

Musk said:

“I should say, it will still make sense to buy FSD as an option as in our view, buying FSD is an investment in the future. And we are confident that it is an investment that will pay off to the consumer – to the benefit of the consumer. In my opinion, buying FSD option is something people will not regret doing.”

Kirkhorn added:

“Agree. And financially, rolling the upfront purchase of the FSD option into a loan in the vehicle or a lease will be the least expensive plan on a monthly basis to own, plus you preserve the option value of increased value over time.”

With the package currently costing $7,000, spread out over a 72-month loan that’s $97 per month.

Therefore, if what Musk and Kirkhorn are saying is true, Tesla will likely not offer the Full Self-Driving package (FSD) subscription for less than $100 per month and likely more than that.

Tesla also said that the price of the package is likely going to increase soon with new features made available.

Despite a high monthly subscription price, Tesla believes that some owners will be interested in a subscription service.

Kirkhorn said:

“We do understand that some customers who have ownership or have leased their vehicles did not purchase that option front. And so this will enable those customers to spread out the cost of ownership of FSD or subscription over time.”

Musk says that Tesla should make the new way to access the FSD package available by the end of the year.

Electrek’s Take

I supposed that makes sense. Those who are purchasing the feature up-front should get the better deal.

But when you don’t buy it upfront, you could save on taxes and insurance by not adding $7,000 to your new car’s sticker price.

Either way, whether you buy it or subscribe for $100+ per month, it’s hard to tell if you get your money’s worth until Tesla delivers on the features.

Right now, I personally don’t think Navigate on Autopilot, Summon, Autopark, etc. are worth $7,000, but if Tesla delivers on a complete “feature-complete” system by the end of the year, even if it requires driver attention, I think the price is starting to make sense.

Of course, once they don’t require driver attention, it’s a steal at that price and it will likely be a lot more to unlock the feature at that point.

That’s still a few years away in most markets in my opinion.

What do you think? Let us know in the comment section below.

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