Tesla (TSLA) CEO Elon Musk announced on X Thursday evening that prices for its Full Self-Driving (FSD) feature will increase as the company advances toward “unsupervised” driving capabilities. In his post, Musk wrote, “The $99/month for supervised FSD will rise as FSD’s capabilities improve. The massive value jump is when you can be on your phone or sleeping for the entire ride (unsupervised FSD).”
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Musk recently also announced that the electric vehicle (EV) giant will stop offering FSD as a one-time purchase from February 14, and shift to a subscription model. Tesla’s current Full Self-Driving (FSD) Supervised software operates at SAE Level 2+, handling complex maneuvers like city driving but requiring constant driver attention.
Musk Targets Full Autonomy
Musk envisions Tesla autos achieving full autonomous driving capabilities, called SAE Level 4, where the vehicle handles all driving tasks in specific conditions without a safety driver. Tesla’s robotaxis currently operate in limited geofenced areas of Austin, Texas, and the San Francisco Bay Area in California, with a safety driver onboard.
Yesterday, Musk announced that some of its robotaxis in Austin have started testing rides without a “human safety monitor” onboard. If successful, this move could be a major win for Tesla, bringing it one step closer to rival Alphabet’s (GOOGL) Waymo driverless taxis. A driverless robotaxi would strongly validate Tesla’s unsupervised FSD capabilities.
Tesla has yet to announce a firm timeline for unsupervised FSD rollout, even though Musk has promoted the capability for years. When FSD was launched, Tesla faced multiple lawsuits and regulatory probes into the company’s claims about its autonomous driving capabilities, forcing the company to add the word “Supervised.” Despite the noise, Musk continues to position robotics, AI, and self-driving tech as Tesla’s primary future growth engines, amid prolonged sales declines in its core EV business.
Is Tesla a Buy, Hold, or Sell Right Now?
Analysts remain sidelined amid the EV sales slump. On TipRanks, Tesla stock has a Hold consensus rating based on 12 Buys, 10 Holds, and seven Sell ratings. The average Tesla price target of $401.77 implies 10.6% downside potential from current levels. Over the past year, TSLA shares have gained 4.6%.
