Sunday, September 28, 2025

Tesla Hits Speed Bump With Self-Driving Software

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Tesla rolled back the latest version of its autonomous driving software, called full self driving, or FSD. It’s a setback for Tesla. The decision will lead to questions about how Tesla introduces new features. It could also lead to some stock market volatility on Monday.

On Sunday, Tesla (ticker: TSLA) CEO Elon Musk tweeted about the decision to roll back version 10.3 of the company’s FSD software. “Seeing some issues with 10.3, so rolling back to 10.2 temporarily,” reads the tweet, adding. “this is to be expected with beta software.”

Tesla wasn’t available to comment on the decision Sunday afternoon.

Testing beta software on roads is the part of the company’s self driving program that might raise eyebrows with U.S. safety regulators. Drivers, and regulators, aren’t used to testing out new features on cars already bought. But Tesla has the ability to update features with over-the-air software updates.

The National Highway Traffic Safety Administration wasn’t available for comment Sunday afternoon.

Tesla believes its new features make cars safer. What’s more, it makes drivers qualify for new features by demonstrating safe driving. Still, releasing and then withdrawing the release a day or two later isn’t the outcome Tesla hoped for.

Tesla’s FSD is a so-called level 2 autonomous driving system. That means it requires drivers to stay engaged at all times. The updated software, essentially, adds new self driving features — like left turns across traffic. None of the updates allow drivers to stop paying attention.

Tesla owners who have qualified for the newer versions also reported Sunday that the rollback has removed versions 10 to 10.2 of the new FSD software. That wasn’t part of the Musk tweet and might have been unintended. Or, perhaps, drivers need to request the latest version of FSD software again.

The FSD hiccup might sap some of the recent strength from Tesla stock. Shares are up about 40% over the past three months. Shares hit a new 52-week high and closed at an all time-high above $909 a share Friday. Better than expected vehicle deliveries reported in early October and better than expected earnings reported this past week have boosted the stock.

Selling more cars is the biggest reason for recent gains. Self-driving software has the potential to add value to Tesla’s stock down the road. Tesla sells FSD as a $10,000 feature or as a monthly subscription today. Better versions of software with more features will mean more software sales for Tesla down the road.

Shares are now up about 29% year to date, better than the 21% and 17% comparable, respective returns of the S&P 500 and Dow Jones Industrial Average.

Source: MarketWatch

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