Tesla will be able to let its employees test its FSD internally on public roads once it successfully registers it with Chinese authorities, and then offer it as an upgrade to Chinese users in the coming months, according to Reuters.

Tesla (NASDAQ: TSLA) is preparing to register its FSD (Full Self-Driving) software with Chinese authorities in the run up to its planned rollout this year, Reuters reported today, citing three people familiar with the matter.

After Tesla successfully registers the software with China's Ministry of Industry and Information Technology (MIIT), it will be able to have its employees conduct internal testing of FSD on public roads in China, and then offer it as an upgrade to Chinese customers in the coming months, two of the people familiar with the matter said, according to the report.

The US electric vehicle (EV) maker is also considering selling the software to car users in China for a monthly fee equal to about $98, they said.

Tesla currently offers FSD to car owners for a one-time fee of RMB 64,000 yuan ($8,840).

The EV maker is working to bring FSD V12 to China, and CEO Elon Musk had said that the latest version of the software gave him confidence that Tesla had a path to delivering fully autonomous driving systems, according to Reuters.

Sales of the FSD in China will provide a new revenue stream for Tesla, which saw sales in China drop 7.6 percent in the first four months of the year as Chinese EV makers ramped up discounting and competition, the report noted.

In China, all Tesla vehicles come with free Basic Autopilot (BAP) software. In addition, Tesla offers Enhanced Autopilot (EAP), FSD software as an option.

In the US, customers can purchase FSD outright for $8,000 or for a monthly subscription fee of $99. In China, there is currently no subscription option for FSD.

In addition to FSD, Tesla also offers the EAP at half the price in China and opens it up for owners to experience for free during some holidays.

On April 27, Tesla began allowing Chinese customers to subscribe to the EAP for RMB 699 per month or RMB 1,399 per quarter.

Musk made an unannounced visit to China late last month. At the time, Bloomberg reported that he aimed to seek FSD approval to help stem Tesla's revenue decline.

($1 = RMB 7.236)

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