How Tesla Recalls Cars with Software Updates

While you may think of your Tesla screen and its software like a giant iPad (because it sure looks like one), the company has used software updates to reshape much of the way we think about cars — and even manufacturer recalls. Imagine getting a recall notice for your “typical” car. You have to go to the dealership or an authorized repair center. You schedule the recall (probably months in advance), drive over, wait in the lobby for what feels like hours, and lament the general awfulness of manufacturer service appointments.

Now imagine you get the same recall notice, letting you know the problem isn’t anything to worry about — because your car already fixed itself. That’s because your car downloaded a software update overnight as it was charging several weeks ago. That update patched the issue cited in the recall before notices even went out. Tesla is, in effect, already doing it. One bold innovator is now disrupting the entire vehicle recall paradigm.

Tesla’s FOTA (firmware over the air) updates deliver new features, enhancements, and UI/UX improvements, providing an experience far more like a smartphone than a sedan. Tesla customers eagerly await the latest major software release for their vehicles, hunt down changes, share their findings with other Tesla fans and community members, and are highly engaged with the brand and product. Many Tesla customers even provide detailed feedback to the company through its closed beta testing programs.

But how can other innovators learn from Tesla’s approach?

Tesla lesson #1: Stop fearing FOTA updates

The biggest barrier to get over when it comes to updatability is fear.

• “What if we upset a customer?”
• “What if we can’t roll back?"
• “What if there are unforeseen complications and we have to send a technician?”
• “None of our competitors update their products, why should we?”
• “What value could updating our product actually add for customers?”
• “We don’t have the time or resources to work on OTAs / FOTAs — we have to build the next product!”

All of these objections are valid. But none of them stop smartphone manufacturers from updating their products monthly, nor the developers of the applications on those devices. And let’s be realistic: It’s exceptionally unlikely your product is as complex or as varied in its use case as a smartphone. This is a question primarily of prioritization, not one of technical feasibility.

Tesla took an assumption — that passenger vehicles were too complicated, too risky, and too impractical to update over the air — and discarded it. Now, legacy automakers are scrambling to add more intelligent in-vehicle systems that can be updated over the air, a process that will likely take them many years as they align the entire vehicle software stack on updatability.

By building its business on this disruptive premise, Tesla was able to deliver something no traditional automaker could: a car that gets better over time. Consumers noticed, and Tesla is reaping the benefits that a disruptor tends to. Customers are fiercely loyal, with Tesla regularly dominating rankings that feature luxury brands like BMW, Porsche, and Lexus. This wasn't just some lucky break, it was a considered and fundamental part of Tesla’s product strategy.

Replicating that model would no doubt require tremendous resources and reorganization at a traditional automaker, but very few companies actually build cars (or anything as complex as them). Many, however, build products that connect wirelessly to the internet and, given the proper business case (and testing), are very feasible to update over the air. Everything from air purifiers to in-restaurant ordering kiosks to the seatback screen on your next intercontinental flight: At the end of the day, they’re computers running an operating system and applications. And most of those operating systems and applications can be updated!

Tesla lesson #2: FOTA updates should delight customers, not trap them

One of Tesla’s most enduring brand associations is that of products that improve over time. If your product is constantly being updated to fix bugs, patch security flaws, and improve performance and stability, that’s great! But it’s the first step to truly resetting customer expectations. Delivering a customer experience that makes your product more competitive, more powerful, and more engaging sounds fantastic, but what does that really mean?

Tesla has used its updates to add video games, novelty horn tones, and even a “light show” mode to its vehicles. While none of these may do much to improve a Tesla’s viability as a piece of transportation, they serve a very defined goal: Building customer engagement. Customers who hunt down a “fun” new feature are probably likely to learn more about how to use your product in more powerful ways. A horn that sounds like flatulence may not be “disruptive,” but it certainly gets customers to pay attention to what you’re doing. Tesla also uses OTAs to build trust, introducing functions like “dog mode” that allows customers to safely keep their pets comfortable in the car.

As part of your FOTA delight strategy, there obviously need to be material improvements and feature progressions included as well. And the more frequently you’re able to issue those updates, the more frequently customers will have an opportunity to try them. But you must similarly be wary of how you deliver and deploy these updates, or you could disrupt the customer’s usage of the product.

Tesla typically deploys its FOTA updates to vehicles overnight, when a car is likely to be charging and otherwise unused for an extended period of time. Similarly, many modern smartphones like the iPhone and Samsung’s Galaxy family will update when the device is plugged in overnight. When a customer wakes up to use their device, a message appears letting them know their phone has been updated and (hopefully) what’s changed through the use of a changelog. It’s important for updates to be seamless: If a customer can’t use the product because it’s being updated, no amount of new features may be able to win back that goodwill.

Tesla lesson #3: Updatability is the next big competitive edge

Agility as a concept is strongly rooted in tech, and the next frontier for agile product development is over the air updatability. Not only can OTA updates add value to a product after a customer has already taken delivery (and for years thereafter), they can introduce significant economic efficiencies.

If Tesla had to bring its vehicles to service centers to receive firmware updates — as is currently true of most major legacy automakers, by the way — it would need to support a massive network of people and real estate across the US (and beyond). Even if these updates took just 10 minutes per vehicle, the time necessary to turn around tens or hundreds of thousands of cars every few months (or weeks) would be tremendous. While Tesla isn’t immune from recalls requiring in-person visits to a facility, the company is reaping major cost savings every time it’s able to remedy a defect over the air (and, often, doing so before customers know there’s a problem).

The more updatable a product is, the more reachable it also tends to become. Full remote control of a device becomes far more realistic, making hands-on support from anywhere in the world possible. And the more consistent your products in the wild are in terms of the firmware or software they’re running, the more confident you can be that every customer is getting the best, newest, fastest experience.

It’s no longer enough to just build a fantastic product — you’ve got to keep making it better.

If you’re building a product that requires a robust, scalable, and highly customizable solution to manage and update customer devices, talk to us at Esper.

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