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Tesla’s rise is unmasking Japan’s risk of being left behind
Tesla has been one of the automakers that have actually managed to thrive this year despite the pandemic. And as the electric car maker continues its rise, it is becoming pretty clear that legacy automakers who refuse to ride the transition to renewable transport risk getting left behind. This is the case even if the automaker in question is Toyota, the previous Number 1 carmaker by market cap.
Tesla only sells a fraction of the vehicles sold by Toyota every year, but the electric car maker has a market cap that is around $370 billion now. That’s roughly equivalent to the annual gross domestic product of Hong Kong, and it’s nowhere near reaching its full potential yet. TSLA bulls like Cathie Wood of ARK Invest note that Tesla’s Autopilot tech and data are pretty much ignored for now, and billionaire investor Ron Baron argues that Tesla Energy has as much potential as the company’s EV business.
Tesla is showing rapid growth across the globe, and this is no more evident than in China, a country that is currently home to the company’s first offshore Gigafactory in Shanghai. Thanks to this, as well as grassroots efforts that make Teslas widely supported by the Chinese government, the company is poised to reap benefits in the country. In Japan, however, things could not be more different. Tesla may have close ties with Japan thanks to its longtime battery partnership with Panasonic and its previous deal with Toyota, but today, the far east country’s mainstream vehicle market remains out of reach for the Silicon Valley-based maker.
Despite this, William Pesek, an award-winning Tokyo-based journalist and author of “Japanization: What the World Can Learn from Japan’s Lost Decades,” argues that Tesla’s rise across the globe further highlights how Japan’s auto market is still stuck in first gear. In an article on the Nikkei Asian Review, Pesek noted that what Japan is so far missing in the Tesla picture is the fact that Elon Musk does not sell cars. While Japan is still busy focusing on hardware, Tesla is already exploring software, allowing Elon Musk to pretty much sell than iPhone on wheels. This ensures that Tesla is capable of embracing the next generation of motoring.
“What Toyota long missed about Musk is that he is not selling cars. He is selling an iPhone with wheels. The vehicle itself is merely a medium to market the software undergirding the iTunes-like community that he is building. The data Tesla collects from users, their environs, interests, tendencies, travel habits and the range of behaviors will arguably be more valuable than the engines and high-performance batteries powering them. This enables Tesla to hone the customer experience, while discerning where the market will veer next,” Pesek wrote.
Perhaps what Japan really needs right now is to embrace the fact that sometimes, disruption is a necessary evil during times of transition. Strictly speaking, legacy automakers like Toyota should have no problem catching up to Tesla by, say 2025, due to their massive talent pool and resources. This does not seem to be case, however, as carmakers like Toyota have a tendency to focus more on legacy than innovation. Toyota has refined its car making processes through decades of refinements, and its global supply chain helps create millions of jobs. This, while noble in a way, is a weight that a company like Tesla simply does not have.
Tesla moves fast, fails fast, and innovates fast. The company’s vertical integration allows it to implement changes and improvements as soon as they are ready. Granted, automakers like Toyota could not adopt such changes overnight, but efforts must be done to increase innovation. This is something that Japanese companies are capable of doing, as seen in the continued efforts of Panasonic’s and its longtime battery partnership with Tesla in Gigafactory Nevada. Perhaps companies like Toyota, Nissan, Honda, and the other premier Japanese carmakers could do the same.
For now, it appears that Elon Musk has already won. So great is the gap in the electric vehicle market that newcomers like Lucid Motors and Rivian Automotive seem to have a better chance at catching Tesla than legacy carmakers. But amidst this threat of being permanently left behind, veterans in the auto market could also see this time as an opportunity to change and raise their electric vehicle game. If there’s anything that Tesla’s rise shows, after all, it is that renewable solutions are the new standard, and they are here to stay.
Tesla made a dramatic change to the Online Design Studio to show its plans for Full Self-Driving, a major part of the company’s plans moving forward, as CEO Elon Musk has been extremely clear on the direction moving forward.
With Tesla taking a stand and removing the ability to purchase Full Self-Driving outright next month, it is already taking steps to initiate that with owners and potential buyers.
On Thursday night, the company updated its Online Design Studio to reflect that in a new move that now lists the three purchase options that are currently available: Monthly Subscription, One-Time Purchase, or Add Later:
🚨 Check out the change Tesla made to its Online Design Studio:
It now lists the Monthly Subscription as an option for Full Self-Driving
It also shows the outright purchase option as expiring on February 14 pic.twitter.com/pM6Svmyy8d
— TESLARATI (@Teslarati) January 23, 2026
This change replaces the former option for purchasing Full Self-Driving at the time of purchase, which was a simple and single box to purchase the suite outright. Subscriptions were activated through the vehicle exclusively.
However, with Musk announcing that Tesla would soon remove the outright purchase option, it is clearer than ever that the Subscription plan is where the company is headed.
The removal of the outright purchase option has been a polarizing topic among the Tesla community, especially considering that there are many people who are concerned about potential price increases or have been saving to purchase it for $8,000.
This would bring an end to the ability to pay for it once and never have to pay for it again. With the Subscription strategy, things are definitely going to change, and if people are paying for their cars monthly, it will essentially add $100 per month to their payment, pricing some people out. The price will increase as well, as Musk said on Thursday, as it improves in functionality.
I should also mention that the $99/month for supervised FSD will rise as FSD’s capabilities improve.
The massive value jump is when you can be on your phone or sleeping for the entire ride (unsupervised FSD). https://t.co/YDKhXN3aaG
— Elon Musk (@elonmusk) January 23, 2026
Those skeptics have grown concerned that this will actually lower the take rate of Full Self-Driving. While it is understandable that FSD would increase in price as the capabilities improve, there are arguments for a tiered system that would allow owners to pay for features that they appreciate and can afford, which would help with data accumulation for the company.
Musk’s new compensation package also would require Tesla to have 10 million active FSD subscriptions, but people are not sure if this will move the needle in the correct direction. If Tesla can potentially offer a cheaper alternative that is not quite unsupervised, things could improve in terms of the number of owners who pay for it.
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Tesla Model S completes first ever FSD Cannonball Run with zero interventions
The coast-to-coast drive marked the first time Tesla’s FSD system completed the iconic, 3,000-mile route end to end with no interventions.
A Tesla Model S has completed the first-ever full Cannonball Run using Full Self-Driving (FSD), traveling from Los Angeles to New York with zero interventions. The coast-to-coast drive marked the first time Tesla’s FSD system completed the iconic, 3,000-mile route end to end, fulfilling a long-discussed benchmark for autonomy.
A full FSD Cannonball Run
As per a report from The Drive, a 2024 Tesla Model S with AI4 and FSD v14.2.2.3 completed the 3,081-mile trip from Redondo Beach in Los Angeles to midtown Manhattan in New York City. The drive was completed by Alex Roy, a former automotive journalist and investor, along with a small team of autonomy experts.
Roy said FSD handled all driving tasks for the entirety of the route, including highway cruising, lane changes, navigation, and adverse weather conditions. The trip took a total of 58 hours and 22 minutes at an average speed of 64 mph, and about 10 hours were spent charging the vehicle. In later comments, Roy noted that he and his team cleaned out the Model S’ cameras during their stops to keep FSD’s performance optimal.
History made
The historic trip was quite impressive, considering that the journey was in the middle of winter. This meant that FSD didn’t just deal with other cars on the road. The vehicle also had to handle extreme cold, snow, ice, slush, and rain.
As per Roy in a post on X, FSD performed so well during the trip that the journey would have been completed faster if the Model S did not have people onboard. “Elon Musk was right. Once an autonomous vehicle is mature, most human input is error. A comedy of human errors added hours and hundreds of miles, but FSD stunned us with its consistent and comfortable behavior,” Roy wrote in a post on X.
Roy’s comments are quite notable as he has previously attempted Cannonball Runs using FSD on December 2024 and February 2025. Neither were zero intervention drives.
Elon Musk
Tesla removes Autopilot as standard, receives criticism online
The move leaves only Traffic Aware Cruise Control as standard equipment on new Tesla orders.
Tesla removed its basic Autopilot package as a standard feature in the United States. The move leaves only Traffic Aware Cruise Control as standard equipment on new Tesla orders, and shifts the company’s strategy towards paid Full Self-Driving subscriptions.
Tesla removes Autopilot
As per observations from the electric vehicle community on social media, Tesla no longer lists Autopilot as standard in its vehicles in the U.S. This suggests that features such as lane-centering and Autosteer have been removed as standard equipment. Previously, most Tesla vehicles came with Autopilot by default, which offers Traffic-Aware Cruise Control and Autosteer.
The change resulted in backlash from some Tesla owners and EV observers, particularly as competing automakers, including mainstream players like Toyota, offer features like lane-centering as standard on many models, including budget vehicles.
That being said, the removal of Autopilot suggests that Tesla is concentrating its autonomy roadmap around FSD subscriptions rather than bundled driver-assistance features. It would be interesting to see how Tesla manages its vehicles’ standard safety features, as it seems out of character for Tesla to make its cars less safe over time.
Musk announces FSD price increases
Following the Autopilot changes, Elon Musk stated on X that Tesla is planning to raise subscription prices for FSD as its capabilities improve. In a post on X, Musk stated that the current $99-per-month price for supervised FSD would increase over time, especially as the system itself becomes more robust.
“I should also mention that the $99/month for supervised FSD will rise as FSD’s capabilities improve. The massive value jump is when you can be on your phone or sleeping for the entire ride (Unsupervised FSD),” Musk wrote.
At the time of his recent post, Tesla still offers FSD as a one-time purchase for $8,000, but Elon Musk has confirmed that this option will be discontinued on February 14, leaving subscriptions as the only way to access the system.
Tesla makes dramatic change to Online Design Studio to show FSD plans
Tesla Model S completes first ever FSD Cannonball Run with zero interventions
