Tesla's Plans for Potential HW3 Upgrades: What Owners Should Know

During Tesla’s recent Q3 2024 Investor Call, Elon Musk provided insights into the path forward for autonomous driving hardware. A key topic of discussion centered on Hardware 3 (HW3), which has lagged behind Tesla’s latest suite, now labeled as AI4. This divergence raises questions for owners of HW3-equipped vehicles, especially regarding Full Self-Driving (FSD) capabilities and future upgrades.

Shifting Views on HW3’s Capabilities

Initially, Tesla’s leadership expressed confidence that HW3 could support FSD and autonomous taxi functionality. However, this assurance has been somewhat revised. While HW3 remains a robust system, engineers and Elon Musk himself have acknowledged uncertainty about HW3's ability to deliver fully autonomous, unsupervised driving. This shift in perspective comes alongside the development of AI4 and the announcement of AI5, expected to enter production in 2026. Tesla has committed to ensuring HW3 is capable but is also preparing to provide upgrades if it cannot meet future autonomy standards.

A Free Upgrade, if Needed

Tesla has now confirmed that should HW3 prove inadequate for FSD, the company will offer a free upgrade for owners who purchased FSD. Early Model 3 vehicles equipped with Hardware 2.5 are also likely eligible for an upgrade upon purchasing FSD. Although details remain limited, Tesla’s commitment to free hardware upgrades, if necessary, extends to those who subscribe to FSD, which provides a level of assurance to HW3 vehicle owners.

This upgrade, however, is not yet scheduled, as Tesla continues to assess whether HW3 is sufficient for future FSD requirements. Current plans focus on developing and refining FSD capabilities for AI4 and adapting these for HW3 if feasible. The upgrade decision would ultimately depend on how far Tesla can push HW3’s capabilities without a full hardware overhaul.

The Nature of the Potential Upgrade

Elon Musk clarified that an HW3 upgrade, if deemed necessary, would focus primarily on enhancing the vehicle’s computing power, not replacing cameras or wiring. AI4 and later systems utilize unified wiring and higher-resolution cameras, which HW3 vehicles lack. While these hardware differences limit HW3's upgradability, Tesla believes that improvements to processing and inference can still deliver substantial FSD performance improvements.

Rather than fully converting HW3 vehicles to AI4, Tesla may develop a dedicated computer module for HW3. This upgrade would aim to bring HW3 vehicles closer to AI4 performance while working within the physical and power limitations of the existing setup. The inference computer in this scenario would leverage smaller, more efficient transistors and advanced processor design, enabling HW3 vehicles to handle demanding FSD computations with minimal modification.

The Redundancy Consideration

Redundancy in processing—having two chips verify each other's conclusions before a decision is made—was an original design feature for HW3. However, Tesla later reconfigured HW3’s resources to maximize computing power, trading off redundancy. Should Tesla proceed with an HW3 retrofit, it’s uncertain whether redundancy will be restored. A return to redundant processing would reinforce safety, though it may also impact the cost and complexity of the retrofit.

Waiting for FSD Progress

Tesla has reiterated that a HW3 upgrade will not occur until FSD achieves the autonomy levels necessary to inform specific hardware requirements. This approach prevents unnecessary upgrades and ensures that any retrofit is a “final solution,” minimizing the need for future changes. For now, Tesla remains focused on progressing FSD on current hardware while keeping HW3 owners informed of potential paths forward.

With the development of AI4 and upcoming AI5, Tesla is positioning itself to refine FSD across a spectrum of hardware. While there are no immediate timelines for an HW3 upgrade, the company’s assurances offer a clear message to owners: if HW3 falls short of delivering safe and effective autonomy, Tesla will bridge the gap with future solutions.