After years of selling cars that would one day enable Full Self-Driving (FSD) features, Tesla has now confirmed that the hardware is not up to the task in millions of cars.
The admission comes from CEO Elon Musk, who recently explained the situation Tesla earnings call. It affects vehicles sold between 2019 and 2023 that operate Tesla’s Hardware 3 driver assistance technology. Each car was sold with the promise that FSD would be later compatible via a software update.
However, Musk now says that “Hardware 3 simply doesn’t have the ability to achieve unsupervised FSD. We thought it would at one point, but it only has one-eighth the memory bandwidth of Hardware 4.”
Memory bandwidth is one of the key components needed for autonomous driving functions to work, Musk says. He also explains that older cars will have to change both their computers and camera systems for FSD functions, which will require complex work on each car.
He suggested that Tesla would set up a “discount trade-in for cars with AI4 equipment.” There are no further details yet on how this will work or when to expect an official plan from Tesla.
Considering the millions of Tesla cars affected, Musk also proposed what he calls “microfactories” in large metropolitan areas to handle the work. “If it’s done in a service center, it’s very slow and inefficient to do it. We basically need mini production lines to make the change,” he said. “I think over time it would make sense for us to convert all Hardware 3 cars to Hardware 4, as this would allow them to enter the robot taxi fleet and have unsupervised FSD.”
Musk teased with permission Tesla owners will rent out their electric carslikening it to Airbnb for self-driving cars. (Services like Turo and Getaround already do that, but the cars aren’t autonomous.) “That’s probably next year because we want to make sure we iron out any kinks,” Musk said in January 2025, though he’s known for not sticking to his own deadlines.
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Case in point: Musk confirmed during the earnings call, Tesla will likely push back its schedule to launch FSD for consumer vehicles again. “I’m just guessing here, but probably in the fourth quarter,” he said when asked about the feature.
In January, Musk said that the Model S sedan and Model X SUV will be produced Closed in Q2 Tesla is moving towards an “autonomous future”. The Fremont, California factory where both models are made will be used to make the upcoming Optimus robots.
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