With Radar Possibly Making a Comeback in Tesla’s Autopilot System and the Growing Legal and Regulatory Scrutiny, the $15,000 Price Tag for the FSD Is Unjustifiable

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A beta product is often discounted quite heavily relative to its finished version – and understandably so. However, Tesla has not only continued to retail the Full Self-Driving (FSD) capability of its Autopilot system without offering such a discount on what is still, inarguably, an unfinished product but also jacked up its price by 300 percent between 2018 and 2022.

The FSD capability of Tesla’s Autopilot can be acquired right now for a $15,000 lump-sum payment or via a monthly subscription that ranges between $99 and $199, depending on the base Autopilot variant. However, now that Tesla is again working on incorporating a radar to its Advanced Driver-Assistance System (ADAS), coupled with the growing regulatory scrutiny and legal backlash, the EV giant’s FSD-related strategy is due an introspection and a deep overhaul.

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Tesla’s Regulatory and Legal Woes

Back in June, the National Highway and Transportation Safety Authority (NHTSA) cast a significant pall over the safety record of the Autopilot system when it revealed that Tesla’s EVs were involved in 70 percent of the crashes that pertained to vehicles sporting a Level 2 ADAS, with 60 percent of these crashes resulting in significant injuries. In total, the NHTSA disclosed 401 incidents for Tesla. Of course, with Tesla EVs constituting the bulk of the Level 2-equipped vehicles on the road currently, the company’s share in road crashes is naturally going to be higher. The NHTSA is also aware of 35 crashes where the Autopilot was activated but has yet to make a determination whether the ADAS was the cause of these accidents.

In addition, California’s Department of Motor Vehicles (DMV) recently characterized Tesla’s self-driving claims as deceptive:

Instead of simply identifying product or brand names, these “Autopilot” and “Full Self-Driving Capability” labels and descriptions represent that vehicles equipped with the ADAS features will operate as an autonomous vehicle, but vehicles equipped with those ADAS features could not at the time of those advertisements, and cannot now, operate as autonomous vehicles.

The DMV is not only urging Tesla to change the labeling of the FSD capability of its Autopilot system but also conducting an independent review of its current capabilities.

As if regulatory scrutiny was not enough, Tesla is currently facing a class-action lawsuit for “allegedly misleading the public regarding its Autopilot, Enhanced Autopilot, and Full Self-Driving Capability (‘FSD’) technology.”

Moreover, back in August, a Tesla Model 3 owner filed a lawsuit, claiming that a defect in the Autopilot caused unintended braking. Additionally, a trial by jury is now expected to take place in Palm Beach County, Florida, in February 2023 regarding a fatal Tesla crash in 2019.

Of course, it is not just the growing regulatory and legal glare on the Tesla Autopilot capabilities. The company itself is apparently moving toward planned obsolescence of older Autopilot systems.

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The EV Giant Appears To Be Looking To Add a High-resolution Radar to Its Autopilot Suite of Sensors

Tesla introduced its vision-based Autopilot with much fanfare. The rationale here was that with just eight cameras and a high-tech neural network to interpret the visual cues, the Autopilot would mimic the way humans make decisions on the road – with the brain interpreting visual signals. However, Tesla recently mentioned a high-resolution radar in its filings with the FCC.

Given the inability of vision-based cameras to work adequately in adverse driving conditions, it makes sense for Tesla to reintroduce a radar in the Autopilot’s suite of sensors. After all, the entire modern concept of technological safety is built upon the concept of multiple redundancies.

This, however, then strikes at the very core of our gripe with Tesla’s approach. The FSD capability of the Autopilot is clearly an unfinished product, as illustrated by the ongoing significant revision in the product's sensor suite. Given that Tesla users are currently acting as guinea pigs in the automaker’s quest to unlock Level 5 autonomous driving, it is unethical that the EV giant continues to charge full price for this product.

In Tesla’s defense, it does stagger the financial recognition of this revenue stream rather than incorporating it into its top-line metric in one go. However, the criterion that Tesla uses to determine how much of the FSD-based revenue to recognize in a given quarter is quite vague.

No one can deny that Tesla is an excellent PR machine. After all, it recently captured the imagination of millions of its die-hard fans by hyping up the Optimus robot – a journey that began last year when Tesla showcased a spandex-clad mannequin on stage but has now evolved to a vision where millions of Optimus robots would soon slave away in Tesla’s gigafactories, unlocking that nirvana of full-fledged automation that Tesla has been pursuing aggressively since 2016. This vision is quite convenient as a distraction from Tesla’s FSD woes. Meanwhile, we’ll know more about the Optimus during the company’s upcoming AI Day event, scheduled for the 30th of September. Stay tuned.

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