Musk’s robotaxi launch: Can Tesla rival Waymo?
Tesla has kicked off its long-promised robotaxi service in Austin, Texas, using a small fleet of modified Model Ys.
The rollout, which began on Sunday, represents the company’s first paid, passenger-carrying trial – and a critical test of its camera-only self-driving vision.
The service is limited to geo-fenced neighbourhoods, avoids airports and complex intersections, and includes a Tesla safety employee in the passenger seat.
The driver’s seat is empty, and remote human operators stand by to intervene if needed.
Chief executive Elon Musk confirmed via X that early rides cost a flat $4.20, and clips shared by influencers show seamless, albeit tightly controlled, journeys through the Texas capital.
Tesla’s shares edged higher in pre-market trading on Monday, a sign of tentative investor optimism following the launch.
Analysts at RBC Capital Markets said the launch framework was broadly expected, but noted the importance of Tesla’s attempt to scale a vision-only autonomous system.
“If Tesla can prove this works safely at scale, its cost advantage over lidar- and radar-heavy systems could be significant”, RBC said.
They estimated that autonomy could make up around 60 per cent of Tesla’s valuation long-term.
Still, the roll-out comes amid increasing regulatory scrutiny. On Friday, Texas governor Greg Abbott signed a law requiring autonomous vehicle operators to obtain DMV permits before removing human drivers – rules that take effect 1st September.
Federal regulators are also active. The National Highway Traffic Safety Administration, NHTSA is still investigating Tesla’s claims about autopilot and full self-driving.
A letter sent in May requested additional detail about the robotaxi’s safety architecture.
Scale vs safety
Unlike rivals like Waymo, which uses lidar, radar and highly detailed maps to guided vehicles, Tesla relies solely on cameras and AI.
Musk argues that this makes the system cheaper and easier to scale – and eventually, more adaptable.
For now, however, Tesla’s system still requires multiple layers of oversight.
And the Austin launch only includes about 10-20 vehicles operating in very specific conditions.
Forrester VP analyst Paul Miller dubbed it a “low-key” launch and cautioned: “Tesla is betting on its scale and data advantage. But if the FSD system isn’t a big leap forward from what’s already on roads, it’ll need an army of remote operators – adding costs and potential reputational risks”.
Meanwhile, competitors are already far ahead. Waymo has completed more than ten million driverless paid rides across several US cities, including Phoenix and San Fransisco.
Its vehicles operate without any in-car safety monitor.
What comes next?
Tesla says a new “cyber cab” – purpose built for autonomy with no pedals or steering wheel – is on the way and will cost under $30,000.
Musk has suggested as many as 1,000 robotaxis could be on roads “within months”, with San Francisco and Los Angeles in the expansion pipeline.
But catching up to Waymo’s tech maturity and regulatory acceptance won’t be easy, as Barclays analyst Dan Levy said: “There’s still a long road ahead to build the infrastructure needed for full autonomy – both physically and legally”.
Still, supporters remain bullish, with Wedbush analysts – who took a ride in the new service – describing the experience as “safe, comfortable, and personalised”.
They also called the launch “the beginning of Tesla’s $1tr AI journey”.