Elon Musk promised it for the end of the year and he kept his word. On October 20, the FSD mode, which allows a few short journeys of the “home-work” type to be carried out entirely independently, began its deployment. What the boss of Tesla did not say was that this new ability would do increase the price of Autopilot. However, this decision is not surprising and fits perfectly with Tesla’s vision.
A predictable increase
In fact, 48 hours after the announcement of the availability of Full Self Driving, the Californian manufacturer increased the price of the Autopilot from 8,000 to 10,000 dollars. This sudden increase fits perfectly with Tesla’s long-term strategy, which is precisely to value its software. In fact, at its inception, the Autopilot option was offered at 3,000 dollars (2,700 euros). However, for the past two years, each arrival of a critical feature has driven up the price of the option. It traded at $ 7,000 at the end of 2019, before picking up another $ 1,000 in spring 2020. It’s not surprising then to see its price move again with the arrival of an even more comprehensive FSD.
The FSD price will continue to rise as the software gets closer to full self-driving capability with regulatory approval. It that point, the value of FSD is probably somewhere in excess of $ 100,000.
– Elon Musk (@elonmusk) May 18, 2020
Above all, Elon Musk is convinced that in the long run his software will be more valuable than the mechanical part of his vehicles, to the point of becoming the main price adjustment value of Tesla. The CEO of the brand even said last May that the price of the Autopilot could one day reach 100,000 dollars. Remember that in some countries, and in France in particular, if the price changes, the capacities of the Autopilot are not the same as those enjoyed by American pilots. And for good reason, autonomous driving laws are much stricter on this side of the Atlantic.
So far, this strategy seems to be paying off. And it’s not Tesla’s latest quarterly results that will change Elon Musk’s mind. Despite a car market hit hard by the Covid-19 crisis, the manufacturer has just announced a fifth consecutive quarter in the green.