Teslas are aging like old smartphones you can't upgrade
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Illustration: Rebecca Zisser/Axios
Tesla's admission that millions of its older cars can't support full self-driving underscores a new reality: software-driven vehicles are starting to age like smartphones — but without an easy upgrade path.
Why it matters: Cars last far longer than phones — about 13 years on average — setting up costly headaches as their hardware struggles to keep up with rapidly evolving features.
The big picture: AI software is improving much faster than the chips and sensors behind it — an expensive hardware ceiling for automobiles that could soon hit millions of non-Teslas, too.
- The risk is that your car's capabilities might expire before the car itself is ready for the junkyard.
Between the lines: The hardware gap isn't exclusive to Tesla.
- "This is just an early sign of a bigger, forever problem that will affect any privately owned autonomous vehicle technology," autonomy expert Phil Koopman, professor emeritus at Carnegie Mellon University, told Axios.
- "Cell phones and laptops get tossed when the technology ages out in perhaps five years," he said. "Cars still have a dozen or two years left on the road with obsolete computers. What's the plan for that?"
Driving the news: For this week, it is a Tesla problem. CEO Elon Musk has long envisioned a world in which cars get better with age through regular software updates.
- He's assured Tesla owners that cars produced since 2019 have all the hardware they need to eventually drive themselves.
- Last week during the company's quarterly earnings, he reversed course, telling investors the computers in Teslas built before 2024 lack sufficient memory to achieve fully autonomous driving.
The broken promise has already triggered an avalanche of lawsuits from Tesla owners, many of whom paid thousands of dollars upfront for a feature they'll never get to use.
Tesla is offering two solutions, and both will be expensive, considering an estimated 3.5 million vehicles — 40% of all Teslas on the road worldwide — are affected.
- Customers can get a discount to trade in their car for a new one equipped with the latest hardware.
- Or they can upgrade their car by having the computer, cameras and wiring replaced, requiring a quasi-rebuild of the vehicle.
Reality check: Upgrading the hardware is the equivalent of major brain surgery, a process that Musk previously acknowledged would be painful and difficult.
- Tesla hasn't said how much the hardware upgrades will cost, or when retrofits will be available.
- As a stopgap, it's planning an "FSD v14 Lite" software update for older cars to provide improved assisted-driving capability that's still short of full autonomy.
What they're saying: Not every Tesla owner will take action, but even if only 1 million vehicles are retrofitted at $3,000 to $5,000 per vehicle, the liability would be $3 billion to $5 billion, figures Gordon Johnson of GLJ Research, per the Wall Street Journal.
What we're watching: For a while, expect manufacturers to offer a "mid-life upgrade strategy" for cars, similar to Tesla's current plan, Koopman said.
- Eventually, though, carmakers have an incentive to stop providing software updates in older — but perfectly operable vehicles.
The bottom line: After all, manufacturers would probably rather sell a new car than upgrade an old one.
