Tesla to Offer Full Self-Driving Software as Subscription in China

Tesla (TSLA) is preparing to register its 'Full Self-Driving' (FSD) software with authorities in China, aiming to roll out the advanced feature this year, according to sources familiar with the matter. The U.S. electric vehicle maker is considering offering FSD as a monthly subscription to users in China, its second-largest market. A successful registration with China’s Ministry of Industry and Information Technology will enable Tesla to internally test FSD on public roads before releasing it to customers as an upgrade. Currently, Tesla offers two less-advanced versions of its Autopilot driver assistance system in China. Tesla’s potential FSD sales in China represent a new revenue stream for the EV maker, which has faced a 7.6% decline in sales volumes in the first four months of the year due to increased competition and discounting by Chinese EV manufacturers. By launching FSD in China, Tesla aims to accelerate its global development of self-driving technology using data collected and processed in China. CEO Elon Musk is confident that Tesla’s latest FSD version, known as version 12, will advance the company’s efforts toward fully autonomous driving systems. Market Overview:

• Tesla is preparing to roll out its Full Self-Driving (FSD) software in China.
• The move aims to counteract a 7.6% decline in sales volumes amid increased competition.
• FSD could be offered as a monthly subscription in China, providing a new revenue stream.

Key Points:

• Tesla’s FSD rollout in China would pressure other EV startups to accelerate their R&D.
• The company is doubling down on global development with data collected in China.
• Tesla’s FSD uses an end-to-end neural network, providing a competitive edge in autonomous driving.

Looking Ahead:

• Tesla plans to test FSD on public roads before releasing it as an upgrade.
• The rollout of FSD in China could impact the strategies of competitors like Huawei and Xpeng.
• Tesla’s robotaxi program details are expected in August, potentially advancing autonomous vehicle capabilities.

Tesla would join at least 10 other automakers and suppliers, including Huawei and Xpeng, in offering level-two autonomous driving capabilities in China. While Tesla will charge for FSD, other manufacturers like Li Auto and Xpeng have offered similar systems for free on high-end models. Tesla’s AI model for autonomous driving, known as an end-to-end neural network, is a departure from rule-based algorithms, allowing for faster learning and more human-like decision-making on the road. Tesla’s Dojo supercomputer trains the FSD system using video clips from millions of its EVs, providing a significant advantage in data processing and development over its rivals. Yin Chengliang, a professor at the Institute of Intelligent Vehicle of Shanghai Jiao Tong University, noted that while competitors can develop necessary algorithms, catching up with Tesla’s data and computing power will be challenging. This connected network of vehicles and the ability to process vast amounts of data give Tesla a major edge in the race toward fully autonomous driving.