FSD Subscription coming "early 2021"

[diplomat33]

"Elon Musk has confirmed that Tesla plans to release its Full Self-Driving software package as a monthly subscription service as soon as “early 2021”.

Tesla is going to release Full Self-Driving monthly subscription in early 2021 - Electrek

 

[akballow]

Wonder how much it is going to be. If it's 10k to own, subscription models are usually less cost-effective than owning. Is it going to be like 1k a month? Or 1k every 1k miles driven on FSD? It will be a slap to FSD owners if it is cheaper to subscribe over a course of ~5 year ownership.

 

[JulienW]

Have wondered how much this will hurt the resale value for us that bought FSD since someone buying used is more likely to buy a much lower priced same car and just get the subscription.

 

[akballow]

Have wondered how much this will hurt the resale value for us that bought FSD since someone buying used is more likely to buy a much lower priced same car and just get the subscription.

I hope this is ONLY for leases, where it does not make sense to purchase it. I will be ok with this.

 

[JulienW]

I hope this is ONLY for leases, where it does not make sense to purchase it. I will be ok with this.

Hope so but this is not what Tesla has been indicating.

 

[diplomat33]

Wonder how much it is going to be. If it's 10k to own, subscription models are usually less cost-effective than owning. Is it going to be like 1k a month? Or 1k every 1k miles driven on FSD? It will be a slap to FSD owners if it is cheaper to subscribe over a course of ~5 year ownership.

Elon has said that it will make more sense financially to buy than to subscribe:

"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."

 

[itsAndrew]

1k/month that is most definitely not going to be the cost. It would be worthless anyone who can afford 12k/year is going to already have FSD.

I am sure someone at Tesla is doing the math on how long the average FSD purchases is keeping their car to come up with a ballpark value.

Let's say the average FSD purchaser keeps their car for 6 years. That would mean at 10k$ you are looking at a 0%APR of 138/month. Let's add a 30% surcharge to that price to make the lump sum price actually attractive. That would be around 179.99$/month FSD subscription.

Now that 30% may NOT be enough of a premium let's make it even more expensive and say FSD will cost 199/Month.

 

[itsAndrew]

FSD is NOT an investment in the future because it is tied to the life cycle of the car.

Do we have data showing that Tesla trade in value covers the full cost you paid for FSD?

 

[akballow]

1k/month that is most definitely not going to be the cost. It would be worthless anyone who can afford 12k/year is going to already have FSD.

I am sure someone at Tesla is doing the math on how long the average FSD purchases is keeping their car to come up with a ballpark value.

Let's say the average FSD purchaser keeps their car for 6 years. That would mean at 10k$ you are looking at a 0%APR of 138/month. Let's add a 30% surcharge to that price to make the lump sum price actually attractive. That would be around 179.99$/month FSD subscription.

Now that 30% may NOT be enough of a premium let's make it even more expensive and say FSD will cost 199/Month.

Would do that over paying 10k upfront since FSD is not transferable. Because let's say I upgrade in 3 years for new features or the new Model that comes out I am out 20k, or whatever the new cost of FSD is then, less, or more. They really need FSD tied to an account, even if it costs more for that option.

Hell in 3 years FSD might be FREE, then you are really out of the benefit of owning.

 

[itsAndrew]

Would do that over paying 10k upfront since FSD is not transferable. Because let's say I upgrade in 3 years for new features or the new Model that comes out I am out 20k, or whatever the new cost of FSD is then, less, or more. They really need FSD tied to an account, even if it costs more for that option.

I agree I have been arguing this point offline with people for a while now. If a car needs AP hardware upgrade I have no issue with that being a line item charge but this nonsense with the licensing is a joke.

 

[base_two]

FSD is NOT an investment in the future because it is tied to the life cycle of the car.

Do we have data showing that Tesla trade in value covers the full cost you paid for FSD?

Well, Tesla is currently throwing in FSD in their used inventory right now. There's a Model LR AWD for $38.5k with 26k miles on there right now. You would likely pay that much third party without FSD included in a third party sale. So they surely aren't valuing it at 10K.

Secondly, the pricing of FSD is going to eventually settle on what's the most sensible price point/strategy to sign up the most owners that have FSD capability in their cars. That's how subscription models become more profitable over time than traditional single license sales. They might not hit that optimal price point at the subscription launch, but they'll eventually get there. Maybe it's a per mile charge strategy, or contracts, or maybe just aggressive pricing.

So I'm not hyper focused on what pricing will be based on what they charge today for FSD, because the introduction of a subscription model changes everything.

 

[OCR1]

I agree I have been arguing this point offline with people for a while now. If a car needs AP hardware upgrade I have no issue with that being a line item charge but this nonsense with the licensing is a joke.

That’s the big question I have about all this. My car is still on AP V2.5 so they would have to upgrade me to V3 before I could use FSD. So will it cost more for cars with V2.5 to subscribe to FSD because they have to first upgrade their AP hardware? And will you be buying the upgraded computer or leasing it, whereby they could theoretically ask for it back if you cancel the subscription?

 

[JulienW]

That’s the big question I have about all this. My car is still on AP V2.5 so they would have to upgrade me to V3 before I could use FSD. So will it cost more for cars with V2.5 to subscribe to FSD because they have to first upgrade their AP hardware? And will you be buying the upgraded computer or leasing it, whereby they could theoretically ask for it back if you cancel the subscription?

Million unknowns now. My guess would be [straight out of my a$$] 2.5 HW owners may have to pay more per month for the first 6 months or so. BUT all going towards purchase price if you keep subscription.[/straight out of my a$$]

 

[DaveG_NJ]

My gut says the subscription will be in the neighborhood of $199/mon for a 12 month renewable subscription. That would make it slightly more expensive than buying if you kept your car 4 or 5 years and subscribed the whole time.

But I can't see them releasing the subscription model until FSD is released. People who've purchased FSD already are future proofing their cars. No one would pay $10K for NoA and Smart Summon alone and I wouldn't pay the monthly fee until some juicy bit of autonomy goes with it. But, as others have pointed out, it's all speculation at this point.

 

[EVNow]

That’s the big question I have about all this. My car is still on AP V2.5 so they would have to upgrade me to V3 before I could use FSD. So will it cost more for cars with V2.5 to subscribe to FSD because they have to first upgrade their AP hardware? And will you be buying the upgraded computer or leasing it, whereby they could theoretically ask for it back if you cancel the subscription?

My guess is - you have to pay an upfront cost to upgrade your V2.5 to 3.0 - and then pay the normal monthly FSD price.

That $199/month price looks about right - but as FSD gets more capable, both one time FSD price and the monthly subscription price will increase. If and when robotaxi becomes possible, only subscription will be available and might even be based on # of miles driven in FSD or a % of revenue collected (like Uber does).

There's a Model LR AWD for $38.5k with 26k miles on there right now.

I paid $55k for LR (no AWD) and $5k or so (?) for EAP+FSD

So, for anyone cribbing about FSD price increase, pls take note of the car price decrease.

 

[atheurer]

I think $199 would only make sense (to me) if it came with full vehicle insurance, which IMO is something they should be able to do with FSD. Personally, I am thrilled I did not spend $10k up front. And based on resale values, FSD is worth at best a couple thousand dollars.

If FSD was transferrable to another Tesla, even with a small fee (under $500), I probably would have purchased it. I am betting a lot of others would have, too. I can't fathom why Tesla does not get this, as I think it would vastly increase FSD purchases.

Once FSD is ready, I would really like to have a limited free preview, for say 24 hours or X miles. Also, ideally it would be nice to rent by the day, so when I need to do a long road trip, I could rent it for that purpose.

 

[JulienW]

I think $199 would only make sense (to me) if it came with full vehicle insurance, which IMO is something they should be able to do with FSD....

Not a chance. Elon has talked about this in the past and our insurance liability. Instead of being more of a liability, FSD will cause our insurers to start offering us lower rates as the accident repair costs go down.

After all Tesla didn't start an insurance compony to NOT sell insurance.

 

[TrevTremaine]

Any chance the subscription has a chance to become a full purchase if the amount paid out to subscription exceeds the cost of a full purchase? I also agree with an option that atheurer mentions - if you buy, have an option to keep it for yourself or transfer it to the new owner.

 

[Sonus]

The monthly subscription should target leased vehicles.

When you lease a car if you buy FSD for 10K upfront you only really pay ~6K for it since it is part of the lease deal. This means it will increase your lease payment by around 160$.

So for it to make sense the monthly subscription price will have to be under 160$ or it will be more expensive to subscribe vs to buy.

Here is a lease for 2021 model x same config one with FSD one without.
1306$ vs 1147$ which means the price to lease a tesla model x and buy FSD will be 159$ a month.

 

[OCR1]

My guess is - you have to pay an upfront cost to upgrade your V2.5 to 3.0 - and then pay the normal monthly FSD price.

As I think back to the discussions around April 2019 when Tesla was making the cutover from V2.5 to V3 there was much discussion about whether to wait for a V3 vehicle or take one with V2.5. The argument was that if you buy FSD you will get the V3 upgrade for free anyway so there is no reason to wait for a V3 car. If it indeed works out that V2.5 owners have to pay more that will not go over well. Elon told everyone that cars produced after 4/12/2019 would have V3 and then proceeded to build cars for many months afterward with V2.5 computers in them but never told anyone they were still doing this.

He tried doing the same thing in China but the government threatened to sue Tesla for bad faith so he backtracked and offered a free upgrade to anyone who requests one, but only in China.