Tesla has announced a major expansion plan to bring its robotaxi service to half the US population by the end of the year. CEO Elon Musk stated that this vision will be realized despite current limitations.
Tesla to Expand Robotaxi Service
Currently operating only in Austin, Texas, the system is limited to human supervision. A Tesla employee is in the robotaxi vehicles and can override the driving system when necessary.
Tesla announced a 12 percent drop in revenue in the second quarter of this year. Slowing electric vehicle sales and shrinking profit margins contributed to this decline. However, the stock market reaction was largely limited. One of the main reasons for this is Musk’s efforts to keep investor confidence alive with future-oriented projects such as autonomous driving technology and humanoid robots.
Preparations for the expansion of the robotaxi system are underway in states such as Florida, Nevada, Arizona, and California. Tesla’s autonomous driving technology, Full Self-Driving (FSD), is also being tested in Europe and China. However, the system is currently still operating in a “supervised” state.
Developing regulatory frameworks prior to expansion remains the biggest obstacle. Musk openly acknowledged this in his statement. Ashok Elluswamy, head of Tesla’s autonomous driving unit, announced that the first expansion will be in the San Francisco Bay Area. Vehicles will also be equipped with drivers in this area.
Musk also stated that some Tesla owners will be able to upgrade their vehicles to the unsupervised Full Self-Driving version by the end of the year. However, this feature will only be available on vehicles with certain trim levels.
Musk excluded the vast majority of users with HW3 hardware from this transition. Unsupervised FSD requires HW4 or HW5 hardware. While a hardware upgrade option for HW3 vehicles has been discussed in the past, the company has recently stated that it is prioritizing HW4-compatible vehicles.
Tesla needs to expand its robotaxi network to 47 major metropolitan areas in the US, covering a population of approximately 166 million. Given the company’s current technical and regulatory situation, a rollout of this magnitude will require aggressive action in the remaining months of the year.
