Tesla HW3 FSD Update Coming: What's Included & What to Expect

By Karan Singh
Not a Tesla App

It's been a while since HW3 owners have received a new FSD update, with the latest update coming with FSD version 12.5.4.2. While this version added vision-based attention monitoring with sunglasses, it’s still far behind the latest features available on FSD v13.2.1.

Tesla shared their FSD roadmap twice in the past few months, but HW3 was mostly left out, except for a single bullet point that stated there would be improved V12.5.x AI models for city driving.

We’ve recently seen HW4 vehicles receive much larger AI models, camera improvements that include processing video feeds at full resolution and 36 FPS, and much more. FSD V13 also gained features such as the ability to reverse and start FSD from park, amongst others.

It’s clear that HW3 is not powerful enough to run these latest FSD models, but HW3 owners are right to feel left out and disappointed with Tesla selling vehicles with HW3 up through the middle of 2023. Elon Musk has stated that Tesla will upgrade HW3 cars if needed, but are left in the dark in terms of what the upgrade will be and when it’ll become available.

Since that comment from Musk and Tesla’s updated roadmap in late October, Tesla hasn’t shared any additional news on HW3, until now.

Ashok Elluswamy, VP of AI at Tesla, has confirmed on X that an FSD update for HW3 owners is coming before the end of the year. Putting aside the 2 weeks joke, he did confirm that FSD V12.6 will be on its way for HW3 vehicles by the end of the year - which just happens to be about 2 weeks away.

FSD V12.6

WholeMarsBlog on X

It seems that the V12.6 build will be unique to Hardware 3 - as there haven’t been any builds with that FSD version yet. The closest build that we have to look at is FSD V12.5.6.4, which only went out to HW4 vehicles. We expect FSD V12.6 to include everything in 12.5.6.4 with possibly some additions.

FSD V12.5.6 brought a lot of improvements. We covered all of the features in FSD 12.5.6 previously, if you want a detailed breakdown and photos of all the features. However, here’s a high level overview of everything that version included:

  • Better and More Natural Lane Change Decisions

  • Updated Speed Profiles, including Hurry Mode

  • Auto Speed Changes

  • End-to-End Highway Stack

  • Audio Data Collection

These changes greatly improved FSD on HW4, so we’ll have to wait and see if they provide similar improvements for HW3 vehicles. The more natural decisions should improve overall smoothness and get rid of the jerky-wheel syndrome and green-light braking that has become synonymous with V12.5.4.2. Alongside better lane selection, this makes the entire experience much smoother and more fitting of Full Self Driving.

The updated speed profiles are applicable on both roads and highways (up to 50 mph with this version), which means you’ll get an updated Chill Mode (with Minimal Lane Changes), Standard Mode, and the new Hurry Mode, which is focused on driving faster and making more frequent lane changes.

Auto Speed has also been removed in favor of Max Speed, which will let you define an overall max while letting FSD still pick its overall speed up to that maximum set speed. You can adjust the hard max by using your scroll wheel to slow down or speed up the vehicle.

However, the biggest feature in this update is the new End-to-End Highway Stack, which finally brings the benefits of FSD V12 on city streets to highway driving.

The final feature that we’re expecting in FSD V12.6 is the ability to collect audio data to begin training for hearing emergency vehicles. This one will be big and it’s what will make FSD feel very human-like. Tesla is starting off with detecting emergency vehicles, but you can expect them to start detecting much more than that soon.

Tesla hints at that in their release notes, saying that audio sharing will be used for features such as emergency vehicle detection. Expect FSD to react to more in the future, such as vehicles honking or someone yelling. Tesla also said that they’ll be looking to have the vehicle honk when needed.

Why FSD 12.6

It’s interesting that Tesla is choosing to name this version FSD 12.6 instead of FSD 12.5.6.x, like they’ve done in the past. This points at some additional improvements being included, but it’s not clear what they could be. Could Tesla bring down some improvements from FSD V13, or add some features such as the ability to reverse?

Tesla may want to stay away from the FSD V13 name if the HW3 version isn’t going to perform as well as FSD V13 on HW4, but at the same time, they could simplify some FSD V13 features and make them available for HW3 owners.

What’s in FSD V13

Let’s take a quick look at all the features in FSD V13 that weren’t in FSD 12.5.6.x. FSD V13 includes significant improvements to the FSD model that just won’t fit into HW3 that are likely responsible the the smoothness seen in FSD V13. This includes a much larger model, full camera resolution, higher frame rates, and more, but FSD V13 also includes these additional features:

  • Speed Profiles on both City Streets and Highways (available on all roads and speeds)

  • Integrated unpark, reverse, and park capabilities

  • Start FSD from Park

  • Improved reward predictions for collision avoidance

  • Improved camera cleaning

  • Redesigned controller for smoother, more accurate tracking

  • Dynamic routing around road closures, which displays them along an affected route when they are detected by the fleet

While the larger model of FSD V13 is not expected to be available for HW3 vehicles, some of these other features have the possibility of making the cut in V12.6.

Legacy Vehicles

There’s no news on Model S and Model X legacy vehicles with MCU 1 receiving the same update just yet. Teslas with MCU 1 did receive FSD V12.3.6 on update 2024.26.3.1, but we haven’t seen anything indicating there will be another update coming soon. However, getting FSD 12.6 out for HW3 with MCU 2 could be the precursor to it becoming available for older MCU 1 vehicles.

We’re super excited to hear Tesla talking about HW3 vehicles and that an update is coming in just a couple of weeks. While it’s not FSD V13, it could provide massive improvements until a hardware upgrade becomes available for HW3 owners.

How the 25% Auto Tariffs Will Impact Tesla

By Karan Singh
Not a Tesla App

On March 27, the U.S. Administration announced a 25% tariff on all imported vehicles and foreign-made automotive parts, an attempt to strengthen domestic manufacturing. Currently, Tesla and Rivian stand out as the major EV automakers with a predominantly U.S.-built lineup.

In this analysis, we’ll explore the potential impact of these tariffs, examining key factors and what they mean for the industry moving forward.

Percentage of American Parts

One key item we want to point out here before we continue is that the NHTSA defines North American made parts as parts built in either the United States or Canada - Mexico is not included in this number. In November 2024, we found out the percentage of parts Tesla uses that come from the U.S. and Canada. At the top we have Tesla’s Model 3, which uses 75% North American parts.

We’ll be sticking with overall percentage of North American parts since we don’t actually know what percentage Tesla sources from Canada. We do know today that some cameras, essential die parts, and other key components are sourced from Canada for nearly every vehicle in Tesla’s lineup - so it isn’t an insignificant percentage.

Insulated from Tariffs?

At first glance, Tesla may seem insulated from these tariffs. However, its dependence on a global supply chain—particularly parts moving across the U.S.-Canada border under the US-Mexico-Canada Agreement (USMCA)—adds complexity to the equation. Additionally, potential retaliatory tariffs from Canada could further pressure Tesla, a trend already evident in the company being excluded from multiple EV incentives across the country.

While Canada isn’t Tesla’s largest market, it still accounts for a meaningful share of sales. Even a small decline in that market could have a noticeable impact on the company’s bottom line.

Domestic Advantage

Tesla’s domestic advantage is impressive—it manufactures all vehicles sold in North America at just two facilities: Tesla Fremont and Gigafactory Texas. The initial 25% tariff, set to take effect on April 2, 2025, applies to cars and light trucks assembled outside the U.S., likely dealing a heavy blow to competitors like Hyundai and Volkswagen. According to a Goldman Sachs report, these tariffs could drive up vehicle prices by $5,000 to $15,000.

However, this advantage is partially offset by exemptions under the USMCA. To avoid the full tariff, vehicles and parts must meet a strict “rules of origin” requirement, meaning at least 75% of components must come from the U.S., Canada, or Mexico. This exemption remains in place until May 3, 2025, when the second stage of tariffs kicks in—targeting non-U.S. content more directly.

Effectively, the NHTSA and USMCA’s existing framework for defining “North American-made” components is being upended. This shift plays to Tesla’s strengths, but to understand the full impact, we need to take a closer look at its supply chain.

Supply Chains

Tesla’s supply chain is deeply integrated across North America. Approximately 25% of the Model 3 Long Range RWD and AWD comes from Mexico - and some undefined percentage also comes from Canada. That number rises significantly for the other vehicle’s in Tesla’s line-up, which is available in the chart below from early November 2024.

Phase 2 of the tariffs will place an increasing impact on Tesla - especially as it won’t be simple nor quick for Tesla to move all part production to the United States. 

Vehicle

Pct made in US/Canada

Model 3 LR AWD/RWD

75%

Model 3 Performance

70%

Model Y (All Variants)

70%

Cybertruck

65%

Model S

65%

Model X

60%

Battery Production

This is particularly evident in Tesla’s reliance on Canadian minerals, which are crucial for its battery production. Tesla sources key materials like nickel, lithium, and cobalt from Canadian mines, with most of these resources being shipped across the border in an unrefined state. Currently, these shipments face a relatively low 10% tariff from Canada. However, potential retaliatory tariffs could drive costs higher or even restrict access to these essential minerals.

While limiting access may seem extreme, Ontario has already threatened to halt nickel exports from Canada’s largest nickel mine to the U.S.—a move that could pose a serious challenge for Tesla.

Even Elon Musk has acknowledged that Tesla won’t emerge from these tariffs unscathed.

Retaliatory Tariffs

Tariffs are rarely a one-way street. Canada and Mexico are likely to respond with retaliatory tariffs on U.S.-made auto parts or vehicles. Both countries have already explored reducing EV incentives by excluding Tesla from certain rebates. Additionally, there have been discussions about imposing tariffs specifically on Tesla, partly due to Elon Musk’s political involvement.

Consumer Impact

Several scenarios impacting consumers can unfold in response to these upcoming tariffs.

In the short term, higher prices for competitors could drive more customers toward Tesla as they seek more affordable products. However, increased import costs could force Tesla to either absorb the expense or raise prices—potentially offsetting any sales gains.

Cox Automotive, a leading industry analyst, has warned that by mid-April 2025, North America could see reduced production, tighter supply, and rising vehicle prices. Tesla, despite its domestic production, won’t be immune to these effects due to its reliance on a continental supply chain.

To mitigate long-term costs, Tesla could explore securing domestic mineral rights—an expensive move initially but one that could provide stability if tariffs remain in place for years under the current administration.

However, Tesla CFO Vaibhav Taneja acknowledged during the Q4 2025 Earnings Call that the company remains heavily dependent on global parts sourcing. Given Tesla’s own admission of the impact, consumers should expect price increases as the company adjusts to the shifting trade landscape.

What to Take Away

Overall, the 25% tariff presents a double-edged sword for Tesla. While it may offer short-term advantages by making competitors’ vehicles more expensive, long-term, Tesla will also be impacted. Tesla’s reliance on cross-border parts, coupled with potential retaliatory tariffs, could quickly escalate costs and increase vehicle prices.

As the political landscape around tariffs continues to evolve on what seems to be a daily basis, Tesla will need to navigate these changes carefully. Tesla’s supply chain has been optimized for cost-effectiveness and efficiency. Any changes that happen could be driven by the new tariffs. Tesla may be forced to make changes that prioritize reducing tariff costs, potentially at the expense of efficiency. However, if these policies continue to evolve or if tariffs are later removed, Tesla is then stuck with a less-efficient supply change.

The company will likely address these challenges in detail during the Q1 2025 Earnings Call, though that remains several weeks away.

What the Green and Orange Dots in a Tesla Mean

By Karan Singh
Not a Tesla App

Over the years, Tesla has introduced UI elements that indicate when specific hardware or software features are active—and these two new dots follow the same pattern.

In June 2024, Tesla introduced the ability to see which third-party apps have access to the vehicle’s location, and these new indicator dots have a similar goal — to improve transparency on features that impact privacy.

Green Dot

If you’ve noticed a green dot on your Tesla display or the instrument cluster for the Model S or Model X, then you have access to Tesla’s hands-free Autopilot feature.

The green dot is displayed on the screen whenever FSD or Autopilot is active and the vehicle is using the interior camera to monitor the driver’s attention.

The cabin camera does a much better job monitoring the driver than the old method of sensing torque on the steering wheel. The cabin camera detects driver attention by tracking the driver’s head and eyes and making sure they’re focusing on the road. If the driver looks away from the road for an extended period, the vehicle will warn the driver or issue a strike for repeat offenses.

If the cabin camera is occluded or obscured, or if it’s simply too dark, the vehicle will fall back to monitoring the driver by detecting torque on the steering wheel.

The presence of the green dot not only lets the driver know that the interior camera is being used but also lets them know whether they need to keep their hands on the steering wheel.

It’s important to note that images and video taken with the interior camera are processed in the vehicle and do not leave the vehicle unless you have granted access for Tesla to use them to improve functionality.

You can check your privacy and data sharing policy in Controls > Software and tap the Data Sharing button at the bottom.

Orange Dot

The orange dot functions similarly to the green one, but instead of indicating cabin camera usage, it appears when the vehicle’s microphone is active. This was added with software update 2025.2, which now listens for audio cues to detect emergency vehicles and other types of noises that could help the vehicle better understand its environment in the future.

Tesla is currently collecting this data to refine its ability to detect emergency vehicles even before they come into view. This capability is expected to be added in FSD v14 along with a larger model size.

Like cabin camera analytics, drivers can opt to share audio data with Tesla to improve detection accuracy. Many users received an “Allow Sound Detection Analytics” prompt following the recent update. If they consent, Tesla may use certain audio snippets to help improve their detection model. Any data transmitted to Tesla is not linked to a specific user or vehicle, so it can’t be tied to a specific individual.

Otherwise, all audio detection and processing is completed in the vehicle to ensure the driver’s privacy.

The prompt for audio analytics
The prompt for audio analytics
@steveshap.bsky.social‬

Latest Tesla Update

Confirmed by Elon

Take a look at features that Elon Musk has said will be coming soon.

More Tesla News

Tesla Videos

Latest Tesla Update

Confirmed by Elon

Take a look at features that Elon Musk has said will be coming soon.

Subscribe

Subscribe to our weekly newsletter