Tesla stock (TSLA) is facing new pressure as Elon Musk prepares to overhaul how the company makes money from its software. On January 26, 2026, shares fell 1.2% to trade at $443.89, as investors balanced excitement over new technology against the reality of higher costs for drivers. The drop follows an announcement from Musk that the price for Full Self-Driving (FSD) will increase as the software gets smarter and moves toward a future without human drivers.
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Musk Links Pricing to Software Power
Elon Musk has made it clear that the current $99 monthly fee for FSD is not permanent. During a recent update, he stated that the price will rise “incrementally” as the software becomes more capable of handling complex driving without a person’s help. Musk believes that the true value of the product will jump once it reaches “unsupervised” status, where passengers can focus on their phones or even sleep.
This shift is a major part of Tesla’s plan to act more like a software company than a traditional carmaker. By ending the option to buy FSD for a one-time fee of $8,000 on February 14, 2026, Tesla is forcing users into a monthly subscription model. This strategy ensures that as the AI gets better, Tesla can immediately charge more for it, helping to increase its overall profit margins.
Tesla Faces Hurdles in Market Adoption
Even with these big plans, Tesla still faces the challenge of getting people to actually use the service. Currently, only about 12% of Tesla owners subscribe to FSD, a number that has stayed low despite recent software updates. Many customers are hesitant to pay a monthly fee for a feature that still requires them to keep their eyes on the road and their hands near the wheel.
To push more people toward the subscription, Tesla has started removing Basic Autopilot, which used to be free, from its new cars. Now, if a driver wants their car to help with steering on the highway, they must pay for the FSD monthly plan. This paywall strategy is a move that some experts think might backfire if customers feel they are being charged for features that competitors often include for free.
Austin Robotaxi Pilot Reaches Major Milestone
Amid the stock’s sideways movement, Tesla has reached a massive technical goal in Texas. The company recently launched its first fleet of “unsupervised” Robotaxis in Austin, where cars are now picking up passengers without a safety driver in the front seat. This pilot program uses standard Model Y vehicles and is seen as the “true beginning” of the robotaxi service Musk has promised for years.
The success of this Austin fleet is critical for the stock’s long-term health. If the Robotaxis can operate safely without human intervention, it validates Tesla’s choice to use only cameras and AI instead of expensive sensors like LiDAR. At the the moment, the market is waiting to see if this technology can scale to other cities before pushing the stock price tariff-cut">back toward its previous record highs.
Is Tesla a Buy, Hold, or Sell?
According to TipRanks, TSLA stock has received a Hold consensus rating, with 10 Buys, eight Holds, and seven Sells assigned in the last three months. The average Tesla stock price target is $398.38, suggesting a potential downside of 11.3% from the current level.
