Tesla hopes to increase profitability by growing its "fully autonomous driving" business.

Tesla's sales rebound in the second quarter is a bright spot, but its core car business is showing signs of pressure. As Tesla faces increasingly fierce competition in its largest market, the decrease in average selling price has damaged its profitability. The average revenue per Tesla car sold this quarter dropped from $45,345 to $42,730. Due to policy adjustments, the income from selling environmental credits to non-compliant traditional car manufacturers also dried up, decreasing by about two-thirds compared to the same period last year, to $146 million. The compression of Tesla's car business profit margin will make it more difficult to fund Musk's spending plans - this year's spending plan exceeds $25 billion, nearly three times the amount spent last year, for the development of AI-driven autonomous driving technology, robot taxis, and humanoid robots. "This year is a big year for capital expenditure, but I believe that all the projects we are investing in will bring amazing returns," Musk said during an analyst conference call after the financial report was released. To improve profitability, Tesla is relying on its advanced driver-assist software - namely, the "Full Self-Driving (FSD) Supervised" mode - to drive future car sales and revenue growth. Tesla stated that by the end of this quarter, its active FSD subscription base was approximately 1.5 million, a 56% increase from the same period last year. The company obtained approval to deploy FSD in the Netherlands in April, and after approval in the Netherlands, some other European countries have also allowed the use of this technology.