Tesla expected to launch long-discussed robotaxi service

Tesla is set to begin its highly anticipated robotaxi service this Sunday in Austin, Texas, using its Model Y SUVs rather than the futuristic Cybercab, which remains under development. This move marks a significant step in Elon Musk’s push toward autonomous vehicle (AV) technology—an initiative his supporters believe could spark Tesla’s next major growth phase.

The rollout comes as Musk turns his attention back to business following a turbulent period in Donald Trump's administration. Relations between the two recently deteriorated in a very public manner, but Musk has since expressed regret over his statements. Meanwhile, Tesla’s Texas-based operations have forged ahead with the robotaxi plan.

Wedbush analyst Daniel Ives hailed the launch as the beginning of a "golden era of autonomous" for Tesla, estimating the technology could eventually boost Tesla's market value by as much as $1 trillion. Despite widespread skepticism, Ives noted that Sunday’s launch signals the company’s continued momentum in the AV space.

Texas, known for its pro-business stance, has become a prime testing ground for autonomous technology. The state permits AV testing as long as vehicles comply with existing safety and insurance rules. However, a new law—set to take effect on September 1—will require companies to get prior authorization from the Texas Department of Motor Vehicles before operating without human drivers. A group of Democratic lawmakers urged Tesla to delay the rollout until the law is in place and requested the company confirm compliance with the upcoming regulations.

Originally scheduled for June 12, the launch was delayed by Musk, who said he wanted to be "super paranoid" about safety. He told CNBC the rollout would start slowly, with just 10 vehicles in the first week, potentially scaling up to 1,000 within a few months. Future expansion could include cities like San Francisco and Los Angeles.

Initially, the service will operate between 6 a.m. and midnight in a limited, invitation-only area. Though Tesla unveiled the Cybercab last year, production isn’t expected until 2026.

The U.S. National Highway Traffic Safety Administration (NHTSA) continues to monitor Tesla’s Full Self-Driving software, which is under investigation following crash reports. The agency emphasized that while it does not pre-approve AV technologies, manufacturers must ensure they meet safety standards.