Earlier today, Elon Musk announced that Tesla will stop offering Full Self-Driving (FSD) as a one-time purchase and will instead make it available only via subscription. The deadline to buy FSD outright is February 14, 2026; after that date the software will be available exclusively as a monthly subscription.
Although many owners now subscribe rather than buy, that trend has been driven largely by FSD’s high up-front cost. Tesla priced FSD as high as $15,000 in September 2022 before gradually reducing it to the current $8,000 in the U.S.
That said, the shift appears to be driven more by Tesla’s long-term strategy than by customers’ payment preferences.
Steady Revenue
Investors generally prefer predictable revenue streams, and a subscription model delivers that. One-time purchases create uneven revenue spikes—often coinciding with vehicle sales—whereas subscriptions produce steady, recurring income.
Elon Musk’s 2025 CEO Performance Award sets a goal of 10 million active FSD subscriptions. That target also counts FSD purchases toward the total.
Update: FSD purchases are counted toward Musk’s 10 million subscriber goal.
The Hardware Loophole
One major advantage for Tesla is legal and operational. Eliminating the upfront purchase removes the “forever promise” that a vehicle’s existing hardware will eventually support full autonomy, a promise that has generated disputes, lawsuits, and perception issues—particularly for vehicles with Hardware 3, which in some cases require retrofits with newer hardware.
Under a subscription, customers pay for what FSD (Supervised) can do today rather than for a guaranteed future capability. If an older car can no longer run the latest models, the owner can simply cancel the subscription, relieving Tesla of the obligation to perform costly retrofits on aging vehicles.
The Math Didn’t Work
For many buyers, the $8,000 upfront price stopped making financial sense. At the current $99-per-month subscription cost, it takes roughly 6.5 years of continuous payments to match the lump-sum purchase price.
That comparison doesn’t account for opportunity cost—whether investing the money elsewhere, buying upgrades, or choosing other options. Additionally, if a vehicle is totaled, some insurers may not include the cost of FSD in the vehicle’s value; an owner’s FSD license could effectively disappear if they cannot use an available transfer option.
Given the long break-even horizon and the economics involved, subscribing has been the financially superior choice for the majority of owners for some time.
Autonomy Is Worth Much More
The move to subscription-only also raises questions about how Tesla will package FSD going forward. Tesla currently bundles FSD with the Model S, Model X, and the Cyberbeast as part of a Luxe package, which suggests the company may reduce price or repackage features to change the licensing terms.
A subscription-only model gives Tesla the flexibility to segment FSD into tiers—potentially a scaled-down Autopilot, today’s FSD (Supervised), a next-generation FSD (Unsupervised), and even a commercial license for ride-hailing and other services.
Viewed another way, the change could signal Tesla’s belief that it is nearing truly unsupervised FSD. If true autonomy is achieved, the value of FSD would shift from a driver-assist feature to a chauffeur-like service worth tens of thousands of dollars per year.
A subscription is also more convenient for Tesla from a pricing perspective: it allows the company to change terms and adjust monthly fees as FSD’s capabilities—and therefore its value—improve. While $12,000 is a significant sum, Tesla would risk leaving substantial revenue on the table if it sold true autonomy as a one-time purchase without restrictions. By moving customers to subscriptions now, Tesla retains the ability to increase the monthly fee as FSD becomes more valuable over time.
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With Tesla Ending FSD Purchases, Should You Buy It Now? Pros and Cons List