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What does licensing entail? Essentially, Ford or GM would purchase or lease Tesla's advanced self-driving hardware and software stack. They would then deploy these systems in their own vehicles, with Tesla earning a share of the ongoing revenue—potentially around 30%—from subscriptions such as FSD.
This approach benefits Tesla by expanding its ecosystem without having to produce vehicles themselves, while the legacy OEMs leverage Tesla's proven, sophisticated self-driving technology. Given the complexity of developing reliable autonomous systems from scratch, this model offers an expedient path to competitiveness.