Tesla Inc. is making a fundamental change to how customers access its advanced driver-assistance software. Beginning February 14, 2026, the company will eliminate the one-time purchase option for its “Full Self-Driving” (FSD) package, moving exclusively to a subscription-based service. This strategic pivot comes as U.S. safety regulators extend an ongoing investigation into the system’s performance.
Subscription Model Replaces Outright Purchase
The electric vehicle manufacturer will no longer offer FSD for a single payment of $8,000. Instead, clients will have two recurring payment choices: a monthly plan priced at $99 or an annual subscription costing $999. CEO Elon Musk has confirmed this shift in the company’s sales strategy.
This decision follows a recent ruling from a California court on December 17, which found Tesla’s marketing language for “Autopilot” and “Full Self-Driving” potentially misleading. While the timing suggests a possible link to increased regulatory pressure, Tesla’s primary motivation may be financial. The subscription framework guarantees a stream of recurring revenue, a valuable asset during periods of potentially softer vehicle sales. For long-term users, however, the new model means higher costs; the cumulative fees from the annual plan exceed the old upfront price after approximately eight years.
Regulatory Investigation Timeline Extended
In a related development, the National Highway Traffic Safety Administration (NHTSA) has granted Tesla a five-week extension in its ongoing probe. The automaker now has until February 23, 2026, to comply with the agency’s requests for detailed data. The initial deadline was January 16.
Should investors sell immediately? Or is it worth buying Tesla?
This safety investigation, launched in October 2025, encompasses an estimated 2.88 million vehicles. Regulators are examining reports that FSD-equipped cars may proceed through intersections against red lights or fail to yield the right-of-way. Tesla is required to submit comprehensive information on 8,313 specific incident reports. This scrutiny continues as the company aggressively pursues its ambitions for a fully autonomous robotaxi network.
Financial Performance and Market Sentiment
Tesla’s equity closed Friday’s trading session at $437.50 per share. This price sits just below the stock’s 52-week peak of $498.83. The company commands a market valuation of $1.46 trillion, with its shares trading at a price-to-earnings multiple of roughly 293.
Investors are awaiting the next quarterly earnings report, scheduled for January 28. Analyst perspectives on the stock remain divided. Current ratings show 46% of covering analysts recommend buying the shares, while 24% advocate selling. The consensus average price target stands at $410, which is below the current trading level. Notably, UBS analysts recently increased their target price from $247 to $307 but maintained their “Sell” recommendation on the stock.
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