Although it's true that cars switch owners, cars usually stay on the road for 10-15 years so consumers with the annual fee will pay out more in the long run. A

Although it's true that cars switch owners, cars usually stay on the road for 10-15 years so consumers with the annual fee will pay out more in the long run. After working with Toyota in their multimedia and head unit design facility, I can see why car companies would switch from a set price of $300 to a yearly fee. It used to be that you just included a FM radio and a CD player and the driver was good to go. Now, these head units need updates every month. These updates mostly include compatibility with the latest IOS/Android, latest phone hardware, newer versions of Pandora/Spotify/iHeartRadio because people wanted to "thumbs up" their songs, newer versions of the HU OS because these new music app versions broke the old OS, newer maps and less embarrassingly-bad voice recognition. Behind these map updates, there's some tester with an H1B Visa getting paid a salary to drive around in a Sienna to take photos of discrepancies between the map and the actual road. Once you see this, it's easy to understand the switch to an annual fee. However, the largest cost comes from trying to connect to the latest phones to use their 3G/4G. If Tesla wasn't hemorrhaging out money, I'd also wish Tesla had a cheaper car. But Tesla unsustainably lost $702 million last quarter and they need to make enough of a profit to pay back all of their debt and invest in building our future; otherwise they'll go bankrupt. The list of successful car company startups is short. As of 2016, the number of American car companies that haven't gone bankrupt is a grand total of two: Ford and Tesla. Starting a car company is idiotic and an electric car company is idiocy squared. Tesla's end goal is to make an affordable sports car, just as the Ford Model T was an affordable car for the masses that brought Ford from 9% market share to 61% market share. They just can't bring the costs down yet while they are hemorrhaging so much money. Further reading: 1) https://www.tesla.com/blog/secret-tesla-motors-master-plan-just-between-you-and-me https://www.tesla.com/blog/secret-tesla-motors-master-plan-j... 2) https://www.tesla.com/blog/master-plan-part-deux https://www.tesla.com/blog/master-plan-part-deux