One-Month FSD Trial: Tesla’s Last-Ditch Effort to Boost Sales?

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

Tesla, the American electric car manufacturer, has recently announced a one-month free trial of its Full Self-Driving (FSD) technology to customers in the United States. This initiative comes as Tesla faces increasing pressure on its sales and margins due to softening demand and price competition.

Tesla 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 response to these challenges, Musk has taken measures to demonstrate the effectiveness of FSD to new buyers and owners of serviced vehicles. He posted about this on social media platform X and instructed Tesla staff to provide demonstrations of FSD.

Despite these efforts, 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. The price war with competitors that began over a year ago has also impacted Tesla’s margins. Furthermore, Tesla has projected lower delivery growth for this year as it shifts focus to producing its next-generation electric vehicles.

In light of these challenges, 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. While FSD software is available for a subscription fee of $199 per month and not designed to make Tesla vehicles fully autonomous, requiring active driver supervision, this free trial offer and other marketing efforts by Tesla reflect its ongoing efforts to maintain competitiveness in the electric vehicle market.

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