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Tesla to Launch Limited Robotaxi Service in Austin Amid Regulatory Scrutiny and Industry Challenges

Tesla to Launch Limited Robotaxi Service in Austin Amid Regulatory Scrutiny and Industry Challenges
InsideEVs
  • PublishedJune 21, 2025

Tesla is set to launch its long-awaited robotaxi service in Austin, Texas, on June 22, marking a major milestone for the electric vehicle company, CNBC reports.

The pilot will feature a small fleet of Model Y vehicles operating without drivers, although each ride will be monitored by remote supervisors as a backup. The launch is by invitation only, with some social media influencers and early testers receiving exclusive access.

Despite years of promises from CEO Elon Musk—who first predicted a robotaxi debut as early as 2020—the rollout has faced multiple delays and is beginning on a limited scale. The initial rides will take place within a geofenced area of Austin, and the futuristic “CyberCab” design, unveiled in October, will not be part of the early fleet. The first driverless trip from the Tesla factory to a customer’s home is expected to coincide with Musk’s birthday, June 28.

Musk has described the slow rollout as “prudent,” emphasizing the need to confirm safety and performance before expanding the service. Plans are in place to introduce robotaxis in Los Angeles and San Francisco at a later date, with only ten vehicles expected to circulate in Austin for now.

The launch comes at a time of heightened scrutiny from regulators and safety advocates. Earlier this week, a group of Texas lawmakers urged Tesla to postpone the launch until new state laws on self-driving vehicles take effect in September. They requested assurance that Tesla would comply with the new regulations. Safety concerns have also been raised by groups like The Dawn Project, which demonstrated how Tesla’s Full Self Driving (FSD) software could misinterpret road hazards, such as failing to stop for a school bus with flashing lights.

Tesla’s FSD technology, which offers features like automated steering and parking, has faced criticism following reports of accidents and fatalities tracked by the National Highway Traffic Safety Administration. Critics argue that the software is not yet ready for public roads and point to incidents of the technology failing to recognize basic traffic scenarios.

Industry analysts, however, see the robotaxi launch as a pivotal moment for Tesla’s future. Wedbush Securities analyst Dan Ives believes robotaxis could usher in a “golden era of autonomous” driving, with the potential to double Tesla’s market value by 2026—despite the expectation of setbacks along the way. Some experts say Tesla’s global scale gives it a unique advantage, potentially allowing it to license its autonomous technology to other automakers.

Tesla is facing broader challenges as well. The company’s sales have declined in both the US and Europe, and its reputation has been affected by CEO Musk’s political activity and social media controversies. Political tensions have led to some former Tesla owners parting with their vehicles and, in some cases, incidents of vandalism at showrooms.

Joe Yans

Joe Yans is a 25-year-old journalist and interviewer based in Cheyenne, Wyoming. As a local news correspondent and an opinion section interviewer for Wyoming Star, Joe has covered a wide range of critical topics, including the Israel-Palestine war, the Russia-Ukraine conflict, the 2024 U.S. presidential election, and the 2025 LA wildfires. Beyond reporting, Joe has conducted in-depth interviews with prominent scholars from top US and international universities, bringing expert perspectives to complex global and domestic issues.