Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
Tesla's FSD subscription comes as wake-up call for Hyundai's software strategy
Hyundai Motor Group's Pleos Connect in-vehicle infotainment system / Courtesy of Hyundai Motor Group
By Lee Min-hyung
Korean carmaker's SDV monetization strategy remains unclear
Tesla's pivot to a lower-barrier subscription model for its Full Self-Driving (FSD) software in Korea is serving as a sharp wake-up call for Hyundai Motor Group, exposing a widening gap between the two rivals in the race to profit from next-generation in-vehicle software.
Starting Aug. 10, Tesla Korea will offer its supervised FSD package through a monthly subscription priced at 150,000 won ($100), replacing the previous one-time purchase option of 9.04 million won.
The move underscores Tesla's long-term strategy of generating recurring software revenue beyond vehicle sales, while lowering the upfront cost for consumers.
Tesla's latest move underscores the challenges faced by Hyundai Motor Group, which has also been positioning itself as a leading software-defined vehicle (SDV) developer.
The Korean carmaker still faces skepticism from financial markets regarding the commercial viability of its digital subscription-based services.
A 2025 Tesla Model 3 self-drives on a freeway in Los Angeles, Nov. 6, 2025. Reuters-Yonhap
The Korean automaker recently highlighted the rollout of its next-generation Pleos artificial intelligence infotainment platform in its newly launched strategic models, including the Grandeur flagship sedan and the redesigned Avante compact sedan.
The company has also pledged to transform its vehicles into software-centric mobility platforms capable of receiving continuous over-the-air updates and offering personalized digital services.
Despite those ambitions, industry officials say Hyundai has yet to present a clear road map for turning its software investments into meaningful profits.
Unlike Tesla, whose FSD has become a cornerstone of its software revenue strategy, Hyundai's subscription offerings remain relatively limited in both scope and commercial appeal.
For now, Hyundai Motor does not offer any self-driving-related subscription services due to unfinished technological verification. The carmaker sells its Bluelink subscription service at 5,500 won per month, and its coverage includes remote vehicle control and emergency assistance.
While the service demonstrates the carmaker's willingness to experiment with software-based subscriptions, such features are unlikely to generate substantial recurring revenues, as their commercial value falls far behind Tesla's FSD, according to industry officials.
"Hyundai has made significant progress in SDV technology, but investors are still waiting to see when software can become a meaningful earnings driver, rather than simply a value-added feature," an industry official said.
Hyundai Motor's IONIQ 5 self-driving electric SUV drives on a road in Las Vegas in this undated file photo. Courtesy of Hyundai Motor
Tesla's subscription model also offers practical benefits for consumers. Previously, owners had to pay the full 9.04 million won up-front to activate FSD. Under the new system, drivers can subscribe only when they need the feature, reducing the initial financial burden and eliminating the need to negotiate the value of the software option when selling a used vehicle.
For Tesla, the subscription model creates a steady stream of high-margin software revenue independent of new vehicle sales.
Kia also operates a subscription-based connected-car service called Kia Connect, but it is also similar to Hyundai Motor's Bluelink in terms of service coverage, so both services' competitive edge remains limited for the time being.
Tesla's supervised FSD service in Korea is currently available only on U.S.-manufactured Model 3 and Model Y vehicles. However, the landscape could change rapidly if Tesla expands the service to its increasingly popular China-made Model Y, whose sales have been gaining strong momentum here.
“Such a move could strengthen Tesla's software advantage and make it more difficult for Hyundai Motor Group to defend its share of the domestic electric vehicle market, particularly as software increasingly becomes a key factor in consumers' purchasing decisions,” the official said.