tesla (TSLA) late Friday reduced the price for supervised full self-driving from $199 to $99 per month, confirming online chatter. Tesla stock rose slightly after the close.
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Lower prices should lead to more Tesla FSD subscriptions, but the tax rate would need to double to generate more revenue.
Lower prices may also encourage more people to subscribe to FSD rather than pay $12,000 for lifetime service. At $99 per month, it will take a little over 10 years to pay off his $12,000 FSD subscription.
However, the company has started offering free FSD transfers to new Tesla vehicles. Also, if FSD shows dramatic improvement and attracts significant demand, Tesla is likely to raise prices significantly.
Despite its name, FSD is a Level 2 system that requires a human driver to be alert and ready to take over driving at any time.
In late March, the EV giant made one month's worth of FSD available for free to all compatible vehicles.
During Friday's session, there was talk that FSD subscription fees might be cut in half to $99. Tesla CEO Elon Musk has liked multiple posts on his social site X endorsing his $99 monthly FSD.
So the actual announcement wasn't a big surprise.
Tesla stock in late trading
Tesla shares rose 0.3% in late trading. Shares fell 2% to 171.05 in stock market trading on Friday. TSLA stock rose 3.7% for the week, boosted by Musk's promise to unveil robotaxis on August 8th.
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