Tesla Robotaxi Launch Sparks Regulatory Firestorm in California

State Agencies Question Permits for Autonomous Service Expansion

Tesla is reportedly expanding its limited robotaxi service to San Francisco this weekend, following an initial deployment in Austin, Texas. The move raises significant questions about regulatory compliance, as state agencies assert the company lacks necessary permits for driverless operations or commercial ride-hailing.

Permit Void Fuels Regulatory Concerns

According to reports, Tesla plans to invite existing owners to test the service. However, California law, enforced by two key agencies, strictly governs autonomous vehicle operations. The Department of Motor Vehicles (DMV) oversees testing and deployment, requiring distinct permits for each stage: testing with a driver, testing without a driver, and driverless deployment.

While Tesla holds a permit for testing with a human safety operator, it does not possess permits for driverless testing or deployment. As of Wednesday, the DMV confirmed that Tesla had not applied for these additional permits. Only Mercedes-Benz, Nuro, and Waymo currently hold driverless deployment permits.

Furthermore, the California Public Utilities Commission (CPUC) regulates the commercial aspects of ride-hailing and chartered transportation. Tesla’s existing Transportation Charter Party permit, as explained by CPUC spokesperson **Terrie Prosper**, only allows human drivers to operate traditional vehicles for charter services. This is distinct from autonomous vehicle permits, which Tesla has not obtained.

“So-called AV authorizations, which Tesla doesn’t have, allows for the testing and deployment of autonomous vehicles with or without a driver.”

—Terrie Prosper, CPUC Spokesperson

Without these specific AV authorizations from the CPUC, Tesla cannot legally offer autonomous passenger service, whether paid or unpaid, with or without a driver. Even with a human safety operator present, engaging the autonomous systems for passenger service would contravene state regulations.

Tesla Faces Scrutiny Amidst Ongoing Legal Battles

This expansion into California occurs while the DMV is actively seeking to halt Tesla’s vehicle sales in the state. This action stems from a prolonged lawsuit concerning the company’s claims about its vehicles’ self-driving capabilities. Additionally, Tesla is currently involved in a trial related to fatalities linked to the misuse of its Autopilot driver assistance system.

Tesla has yet to demonstrate that its Full Self-Driving software can reliably power a robotaxi network. The service, operating in Austin since June 22 on an invite-only basis, remains limited to the city’s downtown core and major routes, with a safety operator always present in the front passenger seat for potential intervention.

Ambitions Outpace Current Capabilities and Approvals

This limited operation falls short of the “general solution” for autonomous driving that CEO **Elon Musk** has long promised. Musk’s earlier boasts about a cross-country autonomous drive have not materialized. The company is also reportedly exploring robotaxi expansions into Florida and Arizona. Earlier this month, reports indicated Tesla had initiated the certification process for autonomous testing and operation in Arizona.

In 2023, autonomous vehicles logged an average of 33.4 disengagements per 1,000 miles driven in California, according to data from the state’s DMV. Tesla’s figures, if compared, would provide a benchmark for its system’s readiness for public deployment. However, without the necessary permits, such comparisons remain speculative.

Tesla’s robotaxi service is coming to San Francisco this weekend, according to a memo obtained by Business Insider. The expansion follows the initial rollout of the service in Austin, Texas, last month.

— Business Insider (@BusinessInsider) January 22, 2025