Tesla Inc.’s (NASDAQ: TSLA | TSLA Price Prediction) controversial Full Self-Driving software, which is not totally autonomous, is no longer for sale. People will need to subscribe. Musk said so himself, on X: “Tesla will stop selling FSD after Feb 14. FSD will only be available as a monthly subscription thereafter.” No more $8,000 one-time payment. The new model is $99 a month.
The media have speculated about why Musk made this decision. It seems illogical at first. It takes over 80 months at $99 per month to reach $8,000. That’s more than six and a half years. How many people keep a car that long? Maybe the gamble is that customers will buy more than one Tesla and just keep paying.
Musk himself does not seem to be entirely clear about why he likes the new subscription model. On the most recent earnings call, he commented, “Now I’m kind of glad that not that many people bought the FSD package.” Of course, there is a chance that most Tesla owners did not want the package under any circumstances. (New owners, in the past, have received free one-month trials.)
Many suggest that Tesla hardware (the car) should serve as a platform for Tesla services (the software). Over time, as more features are available, each comes at its own price. If Musk can build an attractive suite of services, the monthly yield across millions of Teslas could not only be substantial but could change the company’s financial metrics. One car, many subscriptions.
What the new model does not address is falling Tesla sales. An unsold car offers no chance for Tesla to make more money.
The challenge for Musk and Tesla today is to persuade people to buy the vehicles. There is too much competition, too many hard feelings about Musk’s past and current behavior, and too many people who do not want electric vehicles at all.
The subscription model only works if there are people to subscribe.
Tesla Stock Price Prediction and Forecast 2026–2030
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