Elon Musk confident Tesla will launch full self-driving technology this year

On Wednesday, Tesla CEO Elon Musk announced that the electric vehicle (EV) company is likely to launch its Full Self-Driving (FSD) technology this year, which will generate significant profits and offset some of the margin pressure caused by aggressive price cuts.

Musk acknowledged that he has missed previous targets for achieving self-driving capability in Tesla vehicles, but he believes that the test version of the FSD software will be two steps forward and one step back between releases. Despite the legal and regulatory scrutiny that the technology has drawn following crashes, Musk is confident that the trend is clearly towards full autonomy.

"I hesitate to say this but I think we'll do it this year," said Musk, speaking on a conference call.

"We do have this unique strategic advantage," Musk added. "We are making a car that, if autonomy pans out, that asset will be worth a hell of a lot more in the future than it is now."

Tesla's financial chief, Zachary Kirkhorn, explained that the company's automotive margin in the first quarter was hurt not only by price cuts, but also by increased deferred revenue for FSD software. Kirkhorn noted that this deferral should be recognised once some of the software catches up, but did not elaborate.

Tesla offers its Full Self-Driving (FSD) software as an optional add-on, which can cost up to $15,000. However, the company has recently removed ultrasonic sensors from Model 3 and Model Y vehicles, causing certain functionalities like "smart summon" and "autopark" to be temporarily unavailable.

Musk acknowledged that Tesla's quarterly margin was lower than expected, but he remains focused on prioritising sales growth over profits in a weak economy. He also emphasised that Tesla has a unique strategic advantage in that it is making a car that, if autonomy pans out, will be worth a lot more in the future than it is now.

(With Agency inputs)

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