Tesla FSD’s $100,000 Value Promise Dies as Musk Kills Lifetime Purchase Option

Five years ago, Elon Musk told Tesla owners their Full Self-Driving software would be worth “somewhere in excess of $100,000” once regulatory approval arrived. Yesterday, he announced Tesla will stop selling FSD entirely after February 14, forcing everyone onto a $99 monthly subscription. The appreciating asset just became a perpetual rental fee.

For the thousands of owners who paid $15,000 at FSD’s 2022 peak price, this isn’t just a policy change. It’s the final admission that one of Tesla’s most aggressive marketing narratives was never going to materialize.

The announcement: Tesla will discontinue FSD as a one-time $8,000 purchase after February 14, 2026. Only the $99/month subscription will remain.

The broken promise: Musk repeatedly claimed FSD prices would only rise as the software improved, eventually reaching six-figure valuations.

The reality: FSD remains a Level 2 driver-assistance system requiring constant supervision. It has never achieved unsupervised autonomy.

Why it matters: Tesla is effectively abandoning the “appreciating asset” narrative that drove billions in upfront customer payments.

The Price Promises That Never Materialized

Dan O’Dowd, the software safety engineer who has spent millions campaigning against Tesla’s FSD through The Dawn Project, immediately highlighted the contradiction.

“Musk tricked people into buying Full Self-Driving for $15k by claiming that it would be worth in excess of $100k,” O’Dowd posted on X within hours of the announcement. “In a month’s time it will be worth basically zero.”

O’Dowd attached screenshots of Musk’s historical FSD price claims, creating a damning timeline that Tesla’s most ardent supporters will struggle to defend. The receipts are all there, posted publicly by Musk himself over six years of escalating promises.

On May 18, 2020, Musk tweeted: “The FSD price will continue to rise as the software gets closer to full self-driving capability with regulatory approval. At that point, the value of FSD is probably somewhere in excess of $100,000.”

That wasn’t an off-the-cuff remark. Musk systematically reinforced this narrative through a series of price increase announcements designed to create urgency.

• June 2020: FSD price increases by $1,000 on July 1st.
• October 2020: FSD price increases by $2,000 following limited FSD Beta release.
• January 2022: FSD price will rise as production code release approaches.
• August 2022: FSD rises to $15,000 on September 5th.

Each announcement reinforced the same message: buy now because the price only goes up. The implication was clear. FSD was an investment in future autonomous capability, not just a driver-assistance feature.

What Actually Happened to FSD Prices

The $15,000 peak lasted barely a year. By April 2024, Tesla slashed the price to $8,000 and cut the monthly subscription from $199 to $99. The “appreciating asset” had depreciated by nearly half.

Now Tesla is removing the purchase option entirely. Owners who bought at $15,000 will watch new customers access the same software for $99 monthly, roughly 153 months of payments before reaching the same total cost. The lifetime purchase that was supposed to appreciate to $100,000 has been replaced by a perpetual subscription that costs 47% less than what early adopters paid.

CFO Vaibhav Taneja revealed the adoption problem in October 2025: only 12% of the Tesla fleet has paid for FSD. Despite years of aggressive marketing and free trial campaigns, the vast majority of Tesla owners never believed the hype enough to pay.

The Legal Context Makes This Worse

This announcement arrives one month after a California administrative law judge ruled that Tesla engaged in deceptive marketing around its Autopilot and FSD systems. The DMV gave Tesla 60 days to fix its misleading claims or face a 30-day suspension of its dealer license in the state.

The timing suggests Tesla may be repositioning FSD ahead of potential legal exposure. As Electrek noted, “Moving to a subscription-only model kills the promise.” Subscribers pay for what FSD does today, a Level 2 supervised driver assistance system. They have no basis to sue over failed promises of future autonomous capability because they’re not buying a promise. They’re renting current functionality.

For existing purchasers, the situation is more complicated. Multiple class-action lawsuits are currently proceeding through federal courts alleging Tesla falsely advertised FSD’s capabilities. By eliminating the purchase option, Tesla caps future liability while leaving past purchasers in legal limbo.

The Subscription Math Actually Favors New Customers

At $99 monthly, you’d need to subscribe for 81 consecutive months (6.75 years) to equal the $8,000 purchase price. Average EV ownership spans 3-5 years. For most buyers, subscription was already the smarter financial choice before this announcement.

The real losers are the early adopters who paid $10,000, $12,000, or $15,000 believing Musk’s promises about appreciating value. They subsidized Tesla’s FSD development with billions in upfront payments based on assurances that never materialized.

When those owners trade in their Teslas, the company doesn’t give credit for FSD purchases. The $15,000 investment simply disappears from the vehicle’s value. Tesla keeps the money; owners keep the depreciation.

EVXL’s Take

This is the logical endpoint of the analysis we published last week in “Elon Musk’s ‘5x Value’ Self-Driving Math Has a Fatal Economic Flaw.” Musk has been pricing autonomy against today’s human-driver costs while ignoring that supply explosion crashes prices. The $100,000 value thesis was economically incoherent from the start.

What’s remarkable isn’t that this narrative collapsed. It’s how long it took. For six years, Tesla collected billions in upfront FSD payments from buyers who believed they were purchasing an appreciating asset. That money funded Tesla’s AI development while customers assumed the risk of promises that were never realistic.

Dan O’Dowd has his conflicts of interest. His company Green Hills Software competes in the automotive software space. But his criticism here isn’t about safety testing or mannequin demonstrations. It’s about basic math. Musk said FSD would be worth $100,000. Now it’s worth $99 per month. Those two statements cannot coexist.

Six-month prediction: Expect subscription prices to drop further. Tesla needs subscriber counts for Musk’s compensation targets, which require 10 million active FSD subscriptions. A $49 or $79 monthly tier would boost adoption significantly. The days of premium FSD pricing are over because the “future value” narrative that justified those prices has been officially abandoned.

The February 14 deadline isn’t just Valentine’s Day. It’s the day Tesla stops pretending FSD is an investment.

Editorial Note: This article was researched and drafted with the assistance of AI to ensure technical accuracy and archive retrieval. All insights, industry analysis, and perspectives were provided exclusively by Haye Kesteloo and our other EVXL authors, editors, and Youtube partners to ensure the “Human-First” perspective our readers expect.