Tesla Offers One-Month Free Trial of FSD Technology to Boost Sales and Revenue Amid Softening Demand and Price Competition

Elon Musk announces Tesla will provide US customers with one-month trial of driver-assist technology on Business News

Tesla, an electric car company, announced a one-month free trial of its Full Self-Driving (FSD) technology for customers in the United States. This move comes as the company faces softening demand and increasing price competition, putting pressure on sales and margins. CEO Elon Musk has been a strong advocate for FSD software priced at $12,000 as a potential source of profit for the company. However, he has faced challenges in delivering on his promise of full autonomy due to regulatory and legal scrutiny of Tesla’s safety and marketing practices.

In a social media post, Musk stated that all U.S.-capable cars will be enabled for the one-month trial starting this week. Additionally, he instructed Tesla staff to provide demonstrations of FSD to new buyers and owners of serviced vehicles. Musk emphasized the effectiveness of FSD in an email to employees, highlighting that many people are not aware of how well supervised FSD actually works.

Research shows that the “FSD take rate” in North America is decreasing, with only about 14% of Tesla customers purchasing the package in the third quarter of 2022, down from a high of 53% in the third quarter of 2019. Tesla’s margins have been impacted by a price war with competitors that began over a year ago. The company has also projected lower delivery growth for this year as it shifts focus to producing its next-generation electric vehicles.

Analysts suggest that Musk’s directive to demonstrate FSD is part of a strategy to boost deliveries and revenues at the end of the quarter. The FSD software available for subscription at $199 per month is not designed to make Tesla vehicles fully autonomous but requires active driver supervision

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