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Understanding The Decline In Tesla’s FSD Take Rate



On August 31st, 2021, “Troy Teslike” tweeted data from his long running survey of thousands of Tesla vehicle buyers, showing a low take rate for FSD, Tesla’s “Full Self Driving” software add-on offered since late 2016. For Q2 2021, that survey shows a worldwide FSD take rate of only 11% across all Tesla models, compared to a high of 46% in Q2 2019. Rather than simply assuming this represents a major loss of confidence in FSD, it is worth examining the data and understanding the factors that led to this decline.






First, let’s look at the Q2 2019 spike in FSD take rate. In the span of two quarters, the take rate for the Model S rose from 33% to 81%, and for the Model 3, it rose from 15% to 46%.This can be explained by changes to Tesla’s self-driving packages and reduced pricing. Before February 28th, 2019 (late Q1 2019), Tesla offered Enhanced Autopilot (EAP) and FSD. EAP contained a less-polished version of all current Autopilot features, namely autosteer and auto cruise control, and some of today’s FSD features, including auto lane changes, Navigate on Autopilot, and Summon. FSD, at the time, offered no additional, working features, only the promise that Tesla would later avail buyers of autonomy features as the software improved. It stands to reason that, with no working features, FSD would have had a low take rate.  Then, on February 28th, 2019, Tesla stopped selling EAP, introduced a more basic Autopilot package priced at $3000, and began requiring buyers to purchase FSD for features formerly in EAP.  FSD, now priced at $5000, became a useful addition to the vehicle.

In the same Tesla announcement on that day, in addition to the FSD package receiving new features, Tesla offered sale prices on Autopilot and FSD for new vehicles. This was great for new car buyers and contributed to the spike in FSD take rates, but it had the potential to instantly decrease the resale value of existing owners’ vehicles. In response to backlash from existing owners, Elon Musk tweeted that Tesla would offer a discount on Autopilot and FSD for existing owners:






A table shown to Tesla’s customers at the time (and shared by Troy Teslike) clarifies the statement Elon made:






This substantial deal was a large motivator for many Tesla owners to purchase Autopilot and FSD at a large discount, and for the portion who had previously ordered and received vehicles with EAP, their vehicles were automatically upgraded to FSD at no additional cost. Given the discounts and package changes, the Q2 2019 spike in FSD purchases is understandable.

On a number of occasions over the years, Elon Musk has put forth FSD timelines that have proven to be overly optimistic. Without Elon’s high level of optimism, Tesla and SpaceX would almost certainly not be where they are today. At the same time, this has created unmet expectations among a number of potential FSD adopters. It is understandable that some pessimism surrounding FSD would have contributed to the decline in take rate following Q2 2019.

However, there are less concerning and more practical reasons as to why the take rate has tanked so much in the past two years. Price has been a key factor. Since Q2 2019, the price for FSD has gradually increased, but ultimately, it appears that the larger price difference between Autopilot and FSD, as well as the decrease in the average selling price of Tesla vehicles have been the primary causes of the take rate decline.

To give perspective on the overall price changes for FSD and Autopilot, a graph is provided below showing the FSD, Autopilot, and Enhanced Autopilot price changes over the past several years, along with a graph from Troy Teslike showing the Model S/X, Model 3, and Model Y FSD take rates in North America:

yGV2FpSATZ6gaYn7eCga1O59IbjYWfkOtmgGJUFNNuyM_M78vqs0T3UmBzuFRynDYckpyH3Up_vcmu_m-uARwgN0zEDnzfIV4VwzTIdYFzmKvvHQeg-jnxh9kjgW7AtmcRqVsMlU=s0


9s5wleoes_jcLVLMvOWxg2koCEBGz5cPVzYJB2y4fVuF4X29K6-XZU5lcKc4JG4Hn5CD4hawcqccbS5dBnrwVhsjhlVpfL1auTF7kWkabX4Db9ZYUeR4uKlBWh7KEi1IkePDBo8V=s0


While the take rates have fluctuated a great deal, the combined price of FSD and Autopilot has surprisingly not fluctuated more than $2,000 in the past five years, aside from the early 2019 discounts. Arguably, the total price of FSD and Autopilot has been less significant than the price difference between FSD and Autopilot.

In Q4 2019, Tesla changed the price of Autopilot to $0, meaning its features (traffic aware cruise control and autosteer) were now included with each vehicle. At the time, FSD was priced at $7,000, and the combined cost of FSD and Autopilot dropped by $2,000.  However, this also changed the cost difference between FSD and EAP or Autopilot from $3,000 to $7,000. For many Tesla owners, Autopilot is quite useful and is considered an essential add-on, so when it had a price tag, it was relatively easy for buyers to justify spending $3,000 or $5,000 on it. Then, an additional $3,000 for FSD was not too hard to justify.

However, once Autopilot became standard on all Tesla vehicles, it became much harder to justify an additional $7,000 add-on for features that were considered less essential.  Since then, the price of FSD has further increased from $7,000 to $10,000, meaning there’s now a cost difference of $10,000 between Autopilot and FSD.  This is likely a key reason as to why the take rates for FSD have fallen so significantly.

In addition, it should be noted that the take rate for FSD with Model S/X vehicles has fallen significantly less compared to the Model 3/Y. This can be attributed to the Model 3/Y targeting a more price sensitive demographic. It is much easier to justify purchasing a $10,000 add-on for an $80,000+ vehicle than it is for a $40,000+ vehicle. Of course, Tesla’s sales growth in recent years has come from the Model 3/Y, thus lowering the average sale price.

Further, the global take rates for FSD have been much lower than for North America, as seen in this graph provided by Troy Teslike:

1A84sSD5WBGRHQ3Fct5T2j03tAwdiAADasGIJXjmo2oo7cwvHSzfgJQDI6Hsin3Uu7rbyB0ZrbiKFStxi1zBhGxjV6Zbh9HFc0eTi1kGRPOZfg0EE4yPjOkzF3WBIoIuUiqbICq1=s0


Troy states that “the FSD take rate is very low in China and APAC and they now represent a larger portion of Tesla’s global deliveries which reduces the global take rate.”  Tesla has been delivering increasing numbers in China and Europe. Unfortunately, Autopilot has been crippled in Europe for regulatory reasons, and FSD development has primarily taken place on U.S. roads. All, or virtually all, of the impressive, recent “FSD Beta” YouTube videos have been on North American roads. It is no wonder that take rates are lower overseas.

One might ask whether Tesla should take any steps to increase FSD uptake.

In fact, Tesla has started offering a reasonably affordable $199 a month subscription plan for FSD, allowing owners to try it out for just one month.  In addition, Tesla’s impressive efforts in 3D vision and labeling, neural networks, and accelerated training, as demonstrated at AI Day recently, have shown that the product will speak for itself once “FSD Beta” is polished enough to be released to the public.

The drop in FSD take rate is not as alarming as it might appear. Considering the early 2019 discounts, the increases in FSD marginal cost versus Autopilot, price sensitivity combined with declines in the average sale price of Tesla vehicles, and Autopilot/FSD performance lacking overseas, the relatively low take rate is understandable. It seems likely to trend upward soon.

 
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whitex

Well-Known Member
Sep 30, 2015
6,824
8,669
Seattle area, WA
A friend of mine didn’t want to buy TSLA when it was <$40 (200 before split). He wanted to wait for a couple of quarters of profits. But then, it was too expensive.
So what you're saying everyone should buy TSLA stock instead of FSD? It would have definitely worked out for all the people to date who paid for FSD. Oh wait, all those people would have been even better off if they just bought TSLA stock instead of their cars! Myself included (4 brand new Model S since 2013)! :eek: Where were and your foresight 9 years ago?;)
 
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M3P2021 EU/DK

New Member
Dec 30, 2021
1
2
Denmark
How can Tesla expect people to trust and purchase FSD when for years they have failed to make auto wipers and lights work? Automation that does not work is not automation and is dangerous in this case, in particular the wipers. Strongly suggest that wiper and head-light automation is fixed and made safe as a priority. Should not require government/leagal invervention as is happening in Germany. True shame that otherwise fantastic and innovative cars have so severely hampered usability and are practically made unsafe (dark/rainy conditions) via persistent failure or lack of interest to fix schoolboy mistakes. "Phantom" breaking and related risk of crash from rear traffic is another safety critical issue to address. PhD in control systems and autonomous vehicles.
 

Richbot

Member
Oct 16, 2020
685
687
STL
I don't think they expected people to go for it and were surprised by the fanboy enthusiasm and the enthusiasm for ticking every option box amongst luxury car buyers

Imo it was obvious to anyone who was looking at it with a critical eye that it wasn't actually a Level 3 system and was far away from becoming one when I ordered in October 2020, and by that time there was FSD beta. And if you test-drove an FSD car as I did, you knew very well how far away they were.

I think they underestimated the cult. I don't think Tesla thought it would be such a huge part of their fleet at this time, I think they figured they'd get a core group of very dedicated customers to try it and beta test it for you. Instead a whole bunch of people saw an option box, ticked it because why not YOLO, and here we are, lots of irritated FSD "owners" who probably wish they could have the money back and buy the subscription one day if it ever actually works
 
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Ramphex

Active Member (Beta)
Jun 9, 2021
1,457
3,922
Tampa Bay Area
unsurprising really. The owner profile has changed from early adopter, so less likely to throw 10k at something that probably won't be delivered in the lifetime of a three year lease.
If they still sold EAP I'm sure lots of folks would go for it.
Right now they are being asked to pay $10k to be delivered EAP in terms of what is delivered but much more expensive than EAP.
I have FSD on my car, I'll be replacing it soon and also getting one for my wife. I have no intention of spending $10 per car for something that is still in beta. Heck, even AP is still beta but at least that's included. FSD might be worth money when it doesn't have the beta tag on it, but not before.
Do you really think FSD will ever not have a beta tag on it?
 
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Dunsel

Member
Jan 6, 2022
17
19
Miami
FSD 10.8 is worth every penny ($10K).

It turns a boring city commute into a real life video game.

However I could understand a correlation between those who are unwilling to risk $10K on a nonexistent product and those who are unwilling to risk their lives inside a self-driving car.
 
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IslandRoadster

Former Owner of #609
Nov 24, 2018
387
316
Bainbridge Island, WA
Its the data of some dude on twitter and a spreadsheet. This is not institutional grade research, its literally just some guy on twitter and his spreadsheet. Here's his blog: Teslike.com

Just because he’s “some guy on Twitter” does not necessarily mean he’s wrong.
 

IslandRoadster

Former Owner of #609
Nov 24, 2018
387
316
Bainbridge Island, WA
How can Tesla expect people to trust and purchase FSD when for years they have failed to make auto wipers and lights work? Automation that does not work is not automation and is dangerous in this case, in particular the wipers. Strongly suggest that wiper and head-light automation is fixed and made safe as a priority. Should not require government/leagal invervention as is happening in Germany. True shame that otherwise fantastic and innovative cars have so severely hampered usability and are practically made unsafe (dark/rainy conditions) via persistent failure or lack of interest to fix schoolboy mistakes. "Phantom" breaking and related risk of crash from rear traffic is another safety critical issue to address. PhD in control systems and autonomous vehicles.

I think back to my first Tesla, a 2015 Model S with Autopilot 1.x by Mobile Eye. While when it rolled out it had problems, by the time Mobile Eye was kicked to the curb and Tesla took over Autopilot (AP), it was working very well. I some ways, Tesla still had not caught up to where Mobile Eye was in 2016.

Auto-dimming headlights worked much better. I used them all the time but I still cannot tolerate Tesla’s. There was no phantom braking that I remember in the Mobile Eye system. And it did MUCH better in the rain with radar. In the Pacific Northwest, current AP and full self driving (FSD) is largely useless most of the winter in the rain. Not the Mobile Eye system.

If anything, I’ve been surprised how slow Tesla’s progress has been on basic things. Rather than working to make features better with AP, they roll out a new feature or version and seem to say, “good enough” with the last version with flawed features. They never really solve the problem they’ve moved on from.

Until they start improving individual problems, like phantom braking, they’ll never have the confidence of the average electric car buyer and they’ll never have FSD.
 

novox77

Active Member
Nov 25, 2017
2,364
5,100
NH, MA
Until they start improving individual problems, like phantom braking, they’ll never have the confidence of the average electric car buyer and they’ll never have FSD.

Agree that phantom braking needs to be reduced significantly from current levels, esp in FSD beta.

But it's hardly an individual problem. Phantom braking is the result of a huge number of scenarios where the car thinks there's a safety issue and brakes, when in reality there was no real safety concern. Mostly due to false positives from perception.

My recollection is that phantom braking was prevalent in the AP1 days as well. Overhead highway signs or overpasses has been a constant source of braking since the beginning. For me, this particular false positive has been completely eliminated ever since I got moved to vision-only as part of FSD beta.

I realize I might be in the minority in that regard, as I see tons of people complaining about more phantom braking on vision-only.
 
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