Tesla Slashes FSD Price In Half - From $199 to $99 Per Month: Here's Why They Did It

Tesla has slashed its monthly subscription price for FSD from $199 to $99. Here is the reason they did it.

Tesla FSD: Now $99 Per Month (Instead of $199)

Tesla has reduced the price of its monthly subscription for its full self-driving software (FSD) from $199 to $99 per month and this was something we saw coming earlier today (as well as many others).

FSD is pretty expensive if you buy it upfront right now, at $12,000, however, now that it is $99 per month, that is a much more reasonable price for most people to pay.

There's also the benefit of having a 100 on your safety score for Tesla insurance, so you may save $20 to $30 each month or more, depending on how you drive manually by using FSD.

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Why Tesla Did It

Tesla reduced the price because FSD is not yet autonomous and is currently an advanced driver assist software (ADAS). Tesla drivers are doing Tesla a favor and giving them data. The software is good enough now that it can be widely used and work most of the time.

However, it isn't yet autonomous and does make mistakes. I've been using it for about a week now, and I still have to disengage - usually in construction or when making an unprotected left-hand turn that is too slow.

But, for the most part, it does the job right.

Tesla has lowered the cost largely to get more users of FSD. The take rate - that is, the percentage of Tesla owners that will use FSD is likely to double with the price being lowered. Expect it to go from 10% to around 20% or more. Some even think it could reach as high as 30%. We'll see throughout the year if that happens.

Tesla will get more data for its fleet and to train its neural net with imitation AI learning. This is Tesla's first phase of training its FSD software to drive better than an average human.

Once Tesla has enough human data, it will use that human data in simulation to pit the best human drivers in a synthetic world against each other to see which one does best. This will get FSD to superhuman levels by choosing only the top safest, fastest, and most efficient drivers.

Tesla will accelerate its path to autonomy with this price lowering.

For Further Reading: Tesla FSD Saves The Life Of a Man It Drove To the Hospital at 2:00 AM

Was lowering the price the right thing for Tesla to do here?

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Hi! I'm Jeremy Noel Johnson, and I am a Tesla investor and supporter and own a 2022 Model 3 RWD EV and I don't have range anxiety :). I enjoy bringing you breaking Tesla news as well as anything about Tesla or other EV companies I can find, like Aptera. Other interests of mine are AI, Tesla Energy and the Tesla Bot! You can follow me on X.COM or LinkedIn to stay in touch and follow my Tesla and EV news coverage.

Image Credit: Tesla, Screenshot

Article Reference: Tesla