Tesla’s long-anticipated robotaxi service is finally making its debut, starting in Austin this June, in what CEO Elon Musk says will be a cautious but fast-paced rollout that could see up to 1,000 autonomous Teslas operating in the city within a few months.
The move marks a significant milestone in Tesla’s vision to reshape urban mobility and carve out a new revenue frontier beyond electric vehicle (EV) sales.
“We’ll start with probably 10 for a week, then increase it to 20, 30, 40,” Musk said in an interview with CNBC on Tuesday. “It will probably be at 1,000 within a few months.”
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This will be Tesla’s first real-world deployment of a robotaxi service, part of a broader push by Musk to revolutionize transportation. He has long pitched the idea of a fleet of fully autonomous Teslas that could earn money for their owners, operating like a self-driving Uber, whenever the car is not in personal use. For Tesla owners, this promises a potentially lucrative side hustle. For Tesla, it introduces a new business model that could generate recurring revenue while amplifying the brand’s dominance in mobility tech.
The launch will begin under strict controls. The pilot will be invite-only, and the robotaxis will operate on public roads but be geo-fenced to limited, safer regions of Austin.
“We will geo-fence it,” Musk said. “It’s not going to take intersections unless we are highly confident it’s going to do well with that intersection. Or it will just take a route around that intersection.”
Teleoperators — remote human supervisors — will be on standby to intervene when the autonomous system gets stuck or faces an edge-case scenario. While competitors like Waymo and Zoox also use similar systems, Tesla has historically taken a different approach to autonomy, relying on camera-based systems and neural networks rather than expensive lidar and detailed 3D maps.
Musk has promised that Tesla will scale rapidly once the initial fleet proves itself. After Austin, the company plans to roll out robotaxis to other cities, including San Francisco. By the end of 2026, Musk claims there could be more than 1 million self-driving Teslas on the road in the United States alone — a bolder rehash of a promise he first made in 2019. At the time, Musk claimed there would be 1 million Tesla robotaxis by the end of that year. That goal was missed, and Musk later conceded that punctuality was not his “strong suit.”
Regulatory Hurdles Ahead
But scaling won’t be simple. Tesla’s push to launch robotaxis across multiple states will run headlong into a patchwork of regulations. California, for instance, home to Musk and Tesla’s earliest Full Self-Driving (FSD) experiments, still hasn’t granted full approval to Tesla for robotaxi operations. Alphabet’s Waymo, on the other hand, has already made significant progress in cities like San Francisco, Phoenix, and Los Angeles, and has permission to offer fully driverless rides to paying customers.
“The approval process is very haphazard and sort of state-by-state, and sometimes city-by-city,” Musk said, voicing frustration at the regulatory fragmentation. “We really need to get national regulations in place.”
That lack of federal cohesion could delay Tesla’s rollout in key markets, giving competitors more time to entrench themselves. Waymo, for instance, already operates in dense urban environments and has quietly expanded its fleet while earning regulators’ trust. Unlike Tesla, Waymo has focused on building a purpose-designed self-driving vehicle from the ground up, equipped with lidar and operating under a highly conservative safety model. These choices may slow down development, but have helped avoid high-profile incidents.
Tesla’s Full Self-Driving software remains under public and regulatory scrutiny. A recent test by Business Insider comparing Waymo and Tesla’s supervised FSD showed a Tesla running a red light at a complex intersection in San Francisco. Musk dismissed the test as flawed, saying it “made no sense,” but acknowledged Tesla’s robotaxis will avoid high-risk intersections until system confidence improves.
The robotaxi pilot, while limited in geographic scope, will serve as a crucial test of Tesla’s AI-driven approach to autonomy. Unlike Waymo’s laser-scanned maps and tightly controlled routes, Tesla is betting on fleet-collected real-world data and neural network learning to scale rapidly and cheaply. If it works, Tesla could leapfrog the more cautious, hardware-heavy approaches used by rivals.
A New Business Model
Tesla’s robotaxi venture isn’t just about advancing self-driving technology — it’s also about redefining Tesla as more than an automaker. Musk envisions a future where most Tesla owners can opt in to the autonomous network, allowing their vehicles to work as driverless taxis while they’re at home or at work. This model would transform every Tesla into a potential revenue-generating asset, something no other car company currently offers.
The company has said that eventually, these robotaxis could function without any manual controls, built specifically for autonomy. A new robotaxi design is expected to be unveiled at Tesla’s upcoming event on August 8.