Well-known US investment bank Morgan Stanley believes that Tesla will make more money in the future by selling software functions than by selling the hardware itself, such as the cars themselves.
Tesla is known for its emphasis on software for its electric cars. Recently, it has begun to include paid software features and various subscriptions in its offering. The first was a premium connectivity package. The company also started enabling the unlocking of various car capabilities after purchasing them in the mobile application.
Recently, however, it has taken this business model to the next level with fully autonomous subscription management. This costs the Tesel driver $ 199 a month and provides the ability to use this feature only when the owner needs it. There's no need to spend the full $ 10,000 on a package.
Interestingly, Tesla is offering FSD to the owners of the Advanced Autopilot package for this amount. However, upgrading to FSD will only bring them a response to track signs and traffic lights. The owners were surprised that Tesla gave this feature a price tag of $ 99 per month and thinks that the price does not correspond to the added value.
Tesla's fleet currently consists of approximately 1.5 million cars. However, Morgan Stanly estimates that by the end of the decade it will be 35 to 40 million. This is a very significant increase, which will open up rich opportunities for software sales. In the future, the Bank expects to add other subscription-based services, and thanks to this, significant profits in this area.
These estimates are in line with the plans of the Volkswagen Group, which the company recently presented as part of the New Auto campaign. Volkswagen also sees software as an opportunity and expects high revenues from the industry in the future. It can be seen, therefore, that in the coming years the hardware is likely to recede into the background and the main focus of automakers will shift to the development of software functions.