Tesla Full Self-Driving Price Increase?

Note: since this original article in 2018, Tesla has updated the Autopilot options, see this article on the new Autopilot and Full-Self-Driving lineup for more.

Will there be a price increase for the Full Self-Driving Autopilot option for Tesla vehicles?  Elon thinks so (he believes it should be $5,000, instead of $3,000) and mentioned it during the latest Q4 2017 Tesla Earnings call.  Read on to hear what he said about the potential price increase and other self-driving updates below.

Update on the Cross-Country Autopilot Test

Elon: “… I’ve been meaning to address this because obviously, I missed the mark on that front. Our focus is very much on Model 3 production, so everything else kind of took a second place to that. But we could have done the coast-to-coast drive, but it would have required too much-specialized code to effectively game it or make it somewhat brittle and that it would work for one particular route, but not the general solution. So I think we would be able to repeat it, but if it’s just not any other route, which is not really a true solution.

I am pretty excited about how much progress we’re making on the neural-net front. And it’s a little … it’s also one of those things that’s kind of exponential where the progress doesn’t seem – it doesn’t seem like much progress, it doesn’t seem like much progress, and suddenly “wow!”. That’s been my observation, generally, with AI stuff.

And you look at say something like what Google DeepMind did with AlphaGo. It went from not being able to beat even a pretty good Go player to something that could beat the European champion, then it could beat the world champion, then it could thrash the world champion, then it could thrash everyone simultaneously. Then they made AlphaZero, which could thrash AlphaGo, and where it’s just learning against itself, was better than all the world’s human experts.

It’s going to kind of be like that for self-driving. It will feel like well this is a lame driver, lame driver. Like okay, that’s a pretty good driver. Like holy cow, this driver’s good. It’ll be like that. I mean, timing-wise, I think we could probably do a coast-to-coast drive in three months, six months at the outside.

Software and Full Self-Driving Updates

Elon: “… I think probably the biggest item is as we get the software right, people upgrading to the full self-driving capability of some S and X, and anything with Hardware 2, which is the eight cameras and more advanced ultrasonics and improved compute capability, I think will be capable of the full self-driving. The full self-driving, the Hardware 2 type, is also capable of doing an easy swap-out of the computer, so if it turns out we need additional computing capability to meet the regulatory standards for self-driving, particularly if it’s, like we think with the current computer hardware, we can get to better-than-human, but the standard for regulators may be that you need to be five times better than human or something like that. But we believe that is solvable purely with computer hardware and it would be a relatively minor expense to do that. So I think probably that’s the biggest opportunity.”

Elon: “[we’re] assuming the sort of semi-automated driving doesn’t definitely require any hardware upgrades. And that’s $5,000, of that’s potentially a software product provided with zero marginal cost and 100% margin. And then when full self-driving is available, we think probably that’s more than a $3,000 increment. I think maybe $5,000 increment or something like that.