Tesla starts long-awaited robotaxi service with low-key roll-out

AUSTIN, Texas – Tesla launched its long-awaited robotaxi service on the streets of Austin on June 22 following almost a decade of hype from Mr Elon Musk, kicking off a precarious new era for the carmaker.

Several of the initial users live-streamed video as they downloaded a ride-hailing app and went on their first driverless taxi trips. Shortly after 2pm local time, an online influencer who goes by the moniker Bearded Tesla showed the empty driver seat during a ride in a red Model Y sport utility vehicle (SUV) that lasted just over 10 minutes. “It was smooth,” one of the riders said on the video after the trip ended.

The users with early access are being charged a US$4.20 (S$5.40) flat rate for rides, Mr Musk said earlier on June 22 in a social media post. Tesla hand-picked the initial riders, meaning the public will still have to wait.

The launch is beginning modestly, with just a handful of vehicles limited to a small area of the city.

The low-key roll-out has nonetheless been highly anticipated by investors, who are counting on the new business line to revive a company battered by flagging sales and a consumer backlash against Mr Musk. The Tesla chief executive officer is betting the company’s future on autonomous driving, artificial intelligence and humanoid robots – buzzy but still largely unproven markets.

“This is the first true test,” Mr Gene Munster, managing partner of Deepwater Asset Management, said in an interview. “Anything that happens will be amplified, especially the negative. There’s a lot at stake.”

Tesla ramped up testing recently in the Texas state capital, where Model Y SUVs with manufacturer plates have been spotted regularly in the south and south-east portions of the city.

Some details of the launch emerged in recent days after several social media users – known for promoting Tesla – revealed that they were selected for early access to a new robotaxi app and the ride-hailing service. According to the use parameters posted by one account, robotaxis will be available between 6am and midnight every day within several square kilometres of a geo-fenced area of the city, not including the airport. The service may be limited or unavailable in foul weather. 

A human “safety monitor” will be sitting in the front passenger seat for rides during the early access period, as could be seen in the early videos. Buttons seen on live streams and in posts show the employee has the ability to have the vehicle pull over, stop in lane and contact support.

Mr Musk has said Tesla will initially roll out 10 to 20 vehicles before expanding to a thousand within a few months, and later introducing a purpose-built Cybercab with no pedals or steering wheel.

The CEO has a history of overpromising in the area of autonomy. After hinting at the possibility of an autonomous-car service in a business plan in 2016, he said three years later that Tesla customers would be able to utilise their vehicles as robotaxis by 2020.

Tesla has long offered a system called Full Self Driving that, despite the name, requires continual driver supervision and does not make vehicles autonomous. The company has said it will operate its robotaxi network using an “unsupervised” version of the software that will not require a human driver to monitor.

Safety is a crucial factor in driverless car operations. Incidents that injure or kill people can bring regulatory crackdowns and negative attention to companies. Cruise, the now-defunct autonomy business of General Motors, grounded its fleet in late 2023 and had its operating licence suspended in California following an accident that injured a pedestrian.

Uber Technologies ceased testing self-driving vehicles after one of its SUVs struck and killed a pedestrian in Arizona in 2018. Less than three years later, the company agreed to sell its self-driving business.

Austin has become a hot spot for autonomous vehicle operations. Waymo, which is owned by Google parent Alphabet, is scaling up in the city through a partnership with Uber. Amazon.com’s Zoox is also testing there.

In Texas, Tesla faces few restrictions to operate autonomous vehicles. Driverless vehicles are required to be equipped with cameras, have insurance and follow traffic rules. A ride-share licence is not currently required.

At the federal level, the authorities are taking steps to ease the deployment of autonomous vehicles without driver controls like steering wheels or pedals. The National Highway Traffic Safety Administration said in June that it will streamline the process to get an exemption for such vehicles. Under current policy, the procedure has resulted in lengthy processing times that can last years. BLOOMBERG