Tesla’s (TSLA) full self-driving feature is entering a new chapter as it shifts to a subscription-only service across major markets, reshaping how drivers access one of the most closely watched technologies in the auto industry.
The electric vehicle maker has begun phasing out the option to buy FSD as a one-time software add-on, replacing it with a monthly subscription model in core markets such as the U.S., Canada, Mexico, Australia, and New Zealand, with more regions expected to follow. Existing owners who already paid thousands of dollars up front keep their lifetime access, but new customers will now pay around $99 per month instead of an upfront fee that recently stood near $8,000.
CEO Elon Musk has described the strategy as a way to lower the barrier to entry, align FSD with the company’s broader software-as-a-service strategy, and build a recurring revenue base that can grow with fleet size and software capability. In the U.S., Tesla’s (TSLA) full self-driving became subscription-only starting February 15, while some regions like Australia still allow one-time purchases for a limited grace period into 2026.
What is FSD?
Tesla (TSLA) first introduced Autopilot as an advanced driver-assistance suite in 2014–2015, adding features like traffic-aware cruise control, autosteer, and a summon command to ease driving. Over the following years, the company repeatedly promised full autonomy on timelines that slipped.
Today, FSD is considered Tesla’s (TSLA) top-tier driver-assistance package, built on the company’s Autopilot foundation and marketed as a step toward eventual autonomous driving. The software combines adaptive cruise control, lane-keeping, automated lane changes, and navigation-based highway driving with newer features that attempt to handle traffic lights, stop signs, turns, and complex city streets under driver supervision. Technically, FSD relies on onboard cameras, a dedicated FSD computer, and neural-network models trained on massive volumes of driving data. Notably, Tesla (TSLA) rejected lidar and high-definition maps in favor of a camera-only, vision-centric approach. Despite the branding, regulators and Tesla’s (TSLA) own documentation classify FSD as a Level 2 driver-assistance system, meaning the human driver must remain attentive, keep hands ready, and be prepared to take over at any time.
The road ahead
In general, analysts see the recurring, high-margin software revenue stream from FSD as a positive that can help smooth Tesla’s (TSLA) as it hits bumps in the road with other parts of the business. Looking ahead, Musk has some of Tesla’s (TSLA) long-term value to FSD as it melds with the robotaxi network. FSD will also be a key part of the Cybercab rollout and will be designed to operate at Level 4 autonomy in designated areas, with algorithms that reroute for traffic, adjust for local driving conditions, and learn from billions of miles driven by Tesla (TSLA) owners worldwide.
Tesla’s (TSLA) autonomy-as-a-service ambitions have implications for numerous auto and tech companies, including General Motors (GM), Ford Motor (F), Waymo (WAYMO) (GOOG), Uber Technologies (UBER), Lyft (LYFT), Mobileye (INTC), Aurora Innovation (AUR), Rivian Automotive (RIVN), Toyota Motor (TM), Honda (HMC), Nissan (NSANY), and Nvidia (NVDA).