Elon Musk Admits Tesla Hardware 3 Can’t Support Full Self-Driving, Promises Upgrades

During Tesla’s latest earnings call, CEO Elon Musk acknowledged that the automaker still lacks a clear path to enable Full Self-Driving (FSD) capabilities on vehicles equipped with Hardware 3.

Tesla designed Hardware 3 specifically to support FSD, but Musk admitted that the system cannot achieve unsupervised autonomy. The issue stems from Hardware 3’s memory bandwidth, which is only one-eighth that of the newer Hardware 4—a critical limitation for advanced driver-assistance systems.

In a January 2025 earnings call, Musk previously stated that Tesla would need to upgrade Hardware 3 computers for owners who purchased FSD. He reiterated this point, emphasizing that Hardware 3 “simply does not have the capability to achieve unsupervised FSD.”

Tesla plans to offer upgrades and replacements for computers and cameras in older vehicles, though the company has not yet finalized a concrete implementation plan. Musk suggested that converting all Hardware 3 cars to Hardware 4 over time would be ideal, but acknowledged that in-service upgrades would be extremely slow.

To accelerate the process, Tesla intends to establish microfactories or small factories in major metropolitan areas. However, Musk did not provide details on whether construction has begun or when these facilities might become operational.

In the meantime, Tesla will release FSD version 14 for Hardware 3 by the end of June.

Tesla’s Optimus Robot Production to Begin in July-August

During the same earnings call, Musk announced that Tesla’s Fremont factory will start manufacturing the company’s humanoid Optimus robots between late July and August.

This shift follows Tesla’s decision earlier this year to discontinue production of its Model S and Model X vehicles. The last Model S and Model X cars are expected to roll off the production line in May 2025, giving Tesla a narrow window to repurpose the Fremont facility for Optimus manufacturing.