Tesla is discontinuing its free Autopilot system on Valentine's Day, replacing it with a mandatory $99/month subscription for Full Self-Driving (FSD). This shift eliminates the one-time $8,000 purchase option, forcing drivers into a recurring payment model for Tesla's most advanced driver-assist features.

The move follows intense regulatory pressure. A California judge recently ruled Tesla's marketing was deceptive, suspending its sales license for 60 days. California is Tesla's largest U.S. market, making this a critical strategic pivot. Tesla appears to be rebranding its driver-assist systems to mitigate legal risk.

This change fuels the auto industry's push for subscription revenue, a model GM and BMW have also explored. For Tesla, it's a way to generate steady cash flow amid falling margins and declining sales. CEO Elon Musk hinted the $99 fee will rise as FSD's capabilities improve, eventually targeting fully unsupervised driving.