Tesla shifts from “selling cars” to “software SaaS”? Musk: FSD will suspend the “one-time payment model” and only accept “monthly subscriptions.”

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Tesla CEO Elon Musk announced that the company will stop selling the Full Self-Driving (FSD) system via one-time payment, switching to offering only monthly subscription services.

On January 14, Musk posted on social media that Tesla will stop offering the one-time purchase option for the FSD system after February 14, only retaining the monthly subscription method.

He did not elaborate on the reasons for this decision. Analysts believe that this strategic adjustment reflects that Tesla is shifting from mainly selling electric vehicles to focusing on autonomous driving and robotics, while seeking to expand high-margin subscription income. On Wednesday, Tesla’s stock price dropped 1.8%.

In 2025, Tesla sales declined by 9%, with fourth-quarter sales falling 16% year-on-year. Currently, sales of electric vehicles still account for three-quarters of Tesla's revenue. As of the end of 2025, about 12% of Tesla vehicles have monthly or lifetime FSD subscription services.

Subscription Model Replaces Buyout Model

According to Tesla’s official website, the company currently offers the FSD system in the US for a one-time payment of $8,000 or a monthly subscription of $99.

The system can help drivers change lanes more easily and navigate around other vehicles and objects, but does not make the vehicle fully autonomous, and still requires the driver’s full attention at all times.

For years, Musk has touted FSD’s potential to transform every Tesla into a fully self-driving vehicle.

Some Tesla customers once paid as much as $15,000 for a one-time fee to obtain lifetime usage rights to FSD, hoping their vehicles could eventually achieve full self-driving through software updates.

Although Tesla has made progress in autonomous driving, the current commercial version of FSD has not yet achieved full self-driving.

The FSD version offered to customers can navigate streets and park automatically, but if there is an issue, it will exit autonomous mode and the driver must take over quickly.

Early Users Face Hardware Dilemma

Tesla owners with older models are unable to use the latest version of the software because their vehicles are equipped with earlier hardware versions.

Tesla has acknowledged the need to address this issue by offering hardware upgrades to these customers, but has not yet clarified the specific timing and methods.

Chief Financial Officer Vaibhav Taneja said during an investor call in October:

We do want to first solve the self-driving problem, and then go back to find ways to take care of these customers. These customers are very important; they are early supporters.

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