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A Tesla Model Y electric vehicle is dispalyed on a showroom floor at the Miami Design District on October 21, 2021 in Miami, Florida.
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On Friday, Tesla CEO Elon Musk announced on Twitter that the company will raise the price of its premium driver assistance package, marketed as Full Self-Driving or FSD, from $10,000 to $12,000 on January 17, for customers in the U.S. only.

In a series of posts on Twitter, where he has 69.2 million followers, Musk wrote, “Tesla FSD price rising to $12k on Jan 17. Just in the US. FSD price will rise as we get closer to FSD production code release.”

When a follower asked him about Tesla’s FSD subscription product (which currently costs $199 per month for most customers) Musk noted, “Monthly subscription price will rise when FSD goes to wide release.” He also teased a new release of FSD Beta, an invitation-only program which offers more advanced features to select drivers who meet Tesla’s qualifications.

Tesla does not disclose in its earnings reports exactly how many of its customers pay for FSD up-front or subscribe to FSD each quarter. So it’s not clear how much a price hike in the U.S. could bolster its margins in the future.

The company’s standard driver assistance package is marketed as Autopilot and comes standard with all its new vehicles (the Model S, X, Y and 3).

Autopilot functionality includes but is not limited to automatic emergency braking, forward collision warning, lane keeping and adaptive cruise control, which basically matches the speed of your car to that of the surrounding traffic, according to Tesla’s website.

Tesla’s Full-Self Driving option, also known as FSD, is a premium package that includes the Autopilot functions, and more sophisticated features like automatic lane-changing, stop light recognition, and “smart summon” which lets drivers call their car from a parking spot to come pick them up, using their smartphone and the Tesla app like a remote control. Despite the name, it does not today allow cars to drive themselves automatically with no driver intervention.

Separately, there’s also an FSD Beta tier, which includes even more advanced features.

Only drivers who purchase or subscribe to the FSD package, and receive high marks in a “safety score” from Tesla, can get access to FSD Beta. Once they’re in, they can test unfinished features like “autosteer on city streets,” which Tesla says will eventually enable drivers to navigate around residential and urban surface streets, avoiding all obstacles, without having to steer on their own. 

The California Department of Motor Vehicles and National Highway Traffic Safety Administration are investigating different aspects of Tesla’s FSD development and technology.

Tesla has told both agencies that its technology is only a “level 2” system. By the DMV’s definition, “Level 2 systems may enhance safety or provide driver assistance but are not capable of driving or operating the vehicle without the active physical control or monitoring of a human.”

But Musk has implied the company’s technology is more advanced than level 2. In an interview published on December 28, 2021, YouTuber Lex Fridman asked Musk, “When do you think Tesla will solve Level 4 FSD?” Musk replied, “It’s looking quite likely that it’ll be next year,” meaning 2022.

Tesla has been promising self-driving cars since around 2016 but the company still hasn’t demonstrated the hands-free drive across the US that Elon Musk said would be possible by the end of 2017.