Tesla is one step closer to its goal of running an autonomous Robotaxis fleet on Tuesday, when California regulators granted a license to Elon Musk's electric car maker to begin offering vehicles in the state.
The permit is a prerequisite for applications to operate self-driving force services in California, but a CPUC spokesman said the current permit “does not allow rides” on autonomous vehicles, and does not allow Tesla to operate the riding service to the public.
Instead, a limited license issued by the California Public Utilities Commission grants Tesla permission to advance transport employees in advance using Tesla-owned vehicles.
Tesla's stock has been hampered by a loss of penalty for weeks, which cut its value by almost half, but rose nearly 4% at 1:30pm on Wednesday.
The approval is Tesla's first move towards Tesla's long-term goal of deploying self-driving vehicles, but it's just one of many approvals the company needs before technology is revealed in California.
Waymo, a subsidiary of Google's parent company, Alphabet, is the only company that provides autonomous driving to the public in California.
Former competitor Cruises provided self-driving taxi services primarily in the San Francisco Gulf region, but a series of accidents involving vehicles led state regulators to suspend permits in late 2023.
More than a year later, Cruise's parent company General Motors decided to suspend investments in the Robotaxi program after spending more than $10 billion in 2016.
Tesla has long been seen as a potential major competitor in the autonomous vehicle industry.
Musk has expressed confidence in the economic impact of robot taxis and says it can add trillions of dollars to Tesla's market valuation.
Despite optimism about the company's autonomous driving ambitions, Tesla stocks have faced recent struggles.
Tesla was the beneficiary of the post-election “Trump Bump” when its stock price surged to an all-time high of $480 in mid-December.
But Mask's active role in reducing federal bureaucracy and his proximity to President Trump, as well as far-right parties' propaganda in Europe, has brought dents to the company's sales.
Since mid-December, Tesla shares have lost almost 60% of their value. As of Wednesday afternoon, it was trading at around $235 per share.
Musk's embrace of Maga's politics has caused rashes of vandalism and arson attacks on Tesla vehicles and car dealers across the country in recent weeks.
In October, the company unveiled a prototype of the expected self-driving vehicle that Musk calls the “cybercab.”
Just a month later, Tesla submitted an application for the newly granted ride service permit.
However, we have not yet applied for additional regulatory approvals necessary to operate commercial robot taxi services in the state.
The mask suggests that Texas could be the first place Tesla will deploy a robotic taxi.
Unlike California, Texas has relatively relaxed regulations surrounding self-driving cars, making it a more advantageous environment for early testing.
In December 2021, Tesla officially moved its headquarters from Palo Alto in Austin, California to Austin, Texas after Musk vehemently criticised California regulators for imposing closures on its factory during the pandemic.
Waymo has already introduced Austin's own self-driving taxi to the public this month, signaling an increase in competition in the sector.
For Tesla to legally operate autonomous taxis on public California roads, it will need to obtain additional approvals from both the CPUC and the state Department of Motor Vehicles.
The CPUC oversees employment services such as Uber and Lyft, and the DMV is responsible for assessing the safety of the vehicle. This is an important regulatory hurdle for businesses looking to implement autonomous driving technology.
Tesla is subject to scrutiny of regulations regarding safety records, particularly as it relates to fully automated driving (FSD) technology.
Last fall, the National Highway Traffic Safety Administration began investigating after a Tesla driver attacked and killed a pedestrian, using FSD, an advanced driving aide assistance system that enables semi-automated driving on highways and streets.
