A Friday night cruise with Elon Musk has shown the world just how far Tesla’s Full Self-Driving has advanced and gave viewers a preview of real-world problems. To take a line from Rob Zombie, the latest iteration of FSD may be "More Human Than Human," which could be an issue.
"Nothing but net!" proclaimed Musk as he live-streamed to X.com, a video with more than 42 million views. The Tesla CEO referred to neural nets, the technology underpinning Version 12 of FSD. Tesla is removing 300,000-plus lines of code running the current FSD and is now relying on the car's neural networks to drive the car in V12.
Driving through Palo Alto, California, Musk, with Ashok Elluswamy, Tesla’s Director of Autopilot Software, sitting shotgun, picked random places for the Model S to drive to, and it did so smoothly and almost perfectly.
Technology Behind FSD
The test drive started with a construction zone, which was easily handled, but interestingly, at the end of the cones, the car wasn’t jerking over to find a lane immediately. Instead, like a confident human driver, it easily made its way to the lane with no oncoming traffic. We also watched as it effortlessly navigated speed bumps, roundabouts, pedestrians, bicyclists, and, of course - traffic.
For those who have had successful drives with FSD, you may be thinking, what's the big deal? Musk underscored that this version of FSD does not rely on hard-coded programming or a constant internet connection to function. All necessary inference occurs locally, a significant departure from previous versions.
“This is all nets, baby, nothing but net,” Musk exclaimed, emphasizing the vehicle’s dependency on machine learning rather than programmed instructions. The software operates at full frame rate, taking eight cameras at 36 frames per second to decide what to do. No line of code tells the car what to do at an intersection, on the highway or around other vehicles.
The software was impressive to watch, with its countless improvements over the current V11 version of FSD. Musk's vehicle kept a reasonable speed throughout the drive, even though Autopilot was set to a maximum speed of 85 mph.
When Musk reached his destination, the vehicle also automatically pulled over to the side of the road to park itself instead of just stopping in the middle of the road like it does today.
The Real-World, Real Person Challenge
Instead, Tesla has shown the car countless videos of real-world driving so that it will learn what to do in those situations. But that has caused a problem. As the car noticeably did not come to full stops, Musk explained the challenge posed by the fact that less than 0.5% of drivers come to a complete stop at stop signs.
This makes it incredibly difficult to program the vehicle with such sparse data on people obeying the law. This lack of data highlights Tesla's obstacles in training its AI systems to operate in real-world scenarios where human drivers frequently do not adhere to the rules.
Musk's FSD V12 Stream in 10 Minutes
Watch the highlights of Musk's 45-minute video stream below.
Regulatory Hurdles
This appeared in a few other instances where the car behaved like a confident driver, not endangering anyone but technically breaking the rules of the road. FSD suddenly went from the nervous teenager learning to drive to a good driver. But we know how the NHTSA feels about Tesla not following the rules.
In February, the watchdog issued a recall stating that Tesla was acting too human — I mean not following the rules. It cited FSD Beta software:
Traveling or turning through certain intersections during a stale yellow traffic light;
The perceived duration of the vehicle’s static position at certain intersections with a stop sign, particularly when the intersection is clear of any other road users;
Adjusting vehicle speed while traveling through certain variable speed zones, based on detected speed limit signage and/or the vehicle’s speed offset setting that is adjusted by the driver.
Yes, I’m sure we all stop at every yellow light, come to a complete stop at every stop sign, and never go over the speed limit.
Kudos to Tesla and Musk for this real-world demonstration, and if there was any speculation that it was rigged, Musk did have to intervene at an advanced left-hand signal. This small glitch, Musk reassured, could be addressed with further training and data collection. There will be a lot of training announced Tesla’s commitment to invest $4 billion over the next two years in training computing, signaling the company's dedication to perfecting this groundbreaking technology.
Elon Musk and SpaceX have set some ambitious dates for the first Mars landing. Musk envisions launching the Starship toward Mars by late 2026—less than two years away. There won’t be any humans on board in the initial launches. Instead, Optimus will fill in for humans. Musk stated that human landings could follow as early as 2029 to 2031.
There are certain windows that make flights to Mars feasible for humans. So SpaceX is aiming for humans to be a part of the second or third Earth/Mars launch windows from now, which are 5 to 7 years away.
Tesla continues advancing Optimus, and SpaceX remains relentless. Another Starship test launch is in the books, all while maintaining their steady weekly cadence of Dragon missions to space.
Starship departs for Mars at the end of next year, carrying Optimus.
Civilization On Earth
Musk goes on to state something interesting in another post on X. He says that the key will be whether “Earth’s civilizational technology level will last long enough to ensure Mars can grow by itself, even if supply ships from Earth stop coming.”
The statement suggests two possibilities—that Earth’s civilization collapses or fails to advance enough to solve unforeseen challenges of sustaining life on Mars.
The key concern is whether humanity will remain technologically and industrially capable long enough to ensure that Mars can eventually become self-sufficient. If Earth’s civilization weakens, either due to collapse, stagnation, or regression, Mars might not get the support it needs to reach full independence—leading to the colony’s failure.
Tossing Optimus on board Starship is a smart move, instead of having smaller, single-task robots. Optimus also has the advantage of being upgradeable on Mars as long as the hardware holds up. It could be a lot like what we saw with Tesla vehicles, where the hardware was present for many years before the vehicle was capable of driving on city streets. Optimus’ capabilities will also improve over time, even if the hardware is older.
But, how does Elon Musk envision Optimus’ role on Mars?
The answer might be simple. SpaceX can leverage a fleet of Optimus robots to assemble shelters and infrastructure before humans even arrive.
Optimus is already highly capable, with precise hands adept at manipulating tools and objects. On Mars, it could construct basic habitats, set up survival systems, and even handle ice processing, water recycling, and food production.
These facilities will be absolutely essential for the first humans to comfortably settle in and begin work on expanding, maintaining, and preparing for proper human settlement.
Beyond construction, Optimus has a major advantage—it doesn’t need oxygen. Instead, mission planners would only need to monitor battery levels, wear and tear, and any potential damage.
That said, even humanoid robots face risks. Martian dust has long been an obstacle in space exploration, clogging solar panels, damaging equipment, and causing malfunctions. Tesla will need to redesign Optimus to withstand the harsh conditions. Its joints and components will need to be sealed against Mars’ relentless environment.
Starship
Mechazilla catching Starship7 Rocket Booster for the first time ever! 🚀 Incredible Achievement by @spacex
Starship, the largest rocket ever built, is immensely capable—but still in its early testing phases. SpaceX has dedicated hundreds of hours between each flight test, refining and improving with every launch. With several Super Heavy booster catches now under their belt, the next challenge is proving Starship itself can land.
Once SpaceX can launch, complete a mission, and safely land both the booster and Starship, the dream of reaching Mars may no longer seem so far-fetched.
With that, Happy 23rd Anniversary, SpaceX! We’re with you all the way as you push humanity toward the stars.
Happy 23rd Anniversary to @SpaceX! Founded on March 14, 2002, and still pushing the limits of what’s possible, here’s to the next chapter of making life multi-planetary! pic.twitter.com/mzvrdEagAn
According to Chinese blog posts from earlier last week, now vetted by Reuters, Tesla intends to produce a cut-down version of the Model Y, initially for the Chinese market, sometime in 2026.
This follows the launch of Tesla’s cut-down Model 3 for Mexico, as well as news that Tesla intends to launch their new next-gen model sometime in the near future.
Cut Down, But How?
The new Model Y, internally referred to as Project E41, is designed to lower the entry price of Tesla’s popular SUV—one of the most compelling options on the market due to its size, range, and versatility, especially following the launch of the refreshed Model Y.
To achieve this, Tesla is reportedly aiming to reduce the Model Y’s total cost by nearly 20%, according to reports from China. While exact changes remain unknown, we can make informed guesses based on the cost-saving measures Tesla implemented in the scaled-down Model 3 for Mexico.
Textile Seats and Trim
One of the most noticeable changes in the cost-cut version of the Model 3 in Mexico was the removal of vegan leather throughout the interior. In its place, Tesla opted for a durable textile fabric for the seats, reducing material costs. Additionally, any Alcantara trim pieces were replaced with the same textile in various areas.
No Heated or Cooled Seats
Another major cost-cutting measure was the removal of heated and cooled seats, along with the heated steering wheel. While these feature reductions may seem minor, eliminating them reduces various things, such as electrical components, harnesses, and ductwork that are required for seat ventilation.
No Rear Screen
One of the more unexpected changes in the reduced-cost Model 3 was the removal of the rear screen, despite it being powered by the same front infotainment computer as the front display. Given that the screen functions primarily as an additional display rather than a standalone system, the cost to include it is extremely low. It’s one of those really smart additions Tesla has added that increases value for the consumer with minimal cost to Tesla.
Tesla is unlikely to redesign or modify the vehicle’s wiring harness for this change, meaning a rear screen could potentially be retrofitted later by the customer. Based on replacement part estimates, the screen likely costs Tesla between $5 and $20 per vehicle, which acts as a secondary monitor for the infotainment computer.
Ambient Lighting, Acoustic Glass, Speakers
The final set of changes also focuses on the interior. Tesla replaced the RGB-capable ambient lighting with a simpler white-only version—likely saving only a few dollars per vehicle. While this may seem like a minor and somewhat unexpected cut, it could serve as an upsell opportunity to the standard RWD variant.
Additionally, Tesla reduced the use of dual-pane acoustic glass, now limiting it to just the front windows and windshield. This change drastically cuts costs but also affects cabin noise levels. The dual-pane glass played a key role in making the refreshed Model Y noticeably quieter, so this downgrade will likely bring noise insulation closer to that of the original Model Y.
As for audio, Tesla scaled down the speaker system in the Mexican Model 3 from 17 speakers to just nine, while also removing the subwoofers and one of the audio amplifiers. While this cuts costs due to wiring and speakers, it also has a large impact on the audio quality in the vehicle.
Project E41 is Not the Next-Gen Model
It’s important to note that Project E41 is not the same as the upcoming, more affordable next-gen platform, which is internally referred to as Project Redwood. While Project E41 focuses on a reduced-cost version of the Model Y, Project Redwood is designed to test Tesla’s manufacturing capabilities, using their innovative unboxed assembly method to reduce both costs and production time. The goal is to create a vehicle that is smaller and more affordable, while also keeping it safe and capable of self-driving.
Tesla previously confirmed that they plan to unveil new models—distinct from cut-down versions of the Model 3 or Model Y—during their Q4 2024 Earnings Call. However, the executive team has been careful not to divulge too many details about the upcoming model during interviews. This suggests there may be a lot more that has yet to be unveiled.
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