Tesla has announced a significant milestone in its autonomous vehicle initiative, as the company has launched its fully driverless robotaxi service in Austin. This development comes as CEO Elon Musk predicts that robotaxis will be common across the United States by the end of 2026. However, Musk”s history of missing similar deadlines raises questions about the feasibility of this timeline.
With this new service, Tesla has removed safety monitors from its robotaxi fleet in Austin, allowing passengers to ride without a human backup driver for the first time since the service”s inception in June 2025. Musk shared this news on X, praising the efforts of the Tesla AI team. The timing of this announcement coincides with Musk”s recent statement at the World Economic Forum in Davos, where he reiterated his belief that Tesla”s robotaxis would become widespread by the end of this year.
Despite the ambitious claims, the actual deployment of these vehicles has been slower than expected. According to Barclays, Tesla currently operates only 30 to 50 robotaxis in Austin. This figure falls short of Musk”s earlier target of 500 vehicles by the end of 2025. Only about ten of these vehicles are in operation simultaneously, with the remainder still utilizing safety monitors. Ashok Elluswamy, Tesla”s VP of AI software, explained that unsupervised vehicles will be gradually integrated into the fleet, with the ratio increasing over time.
The limitations of the robotaxi service stem from high demand and a relatively small fleet size. Tesla has previously indicated that the removal of safety monitors was essential for scaling the service, as labor costs were prohibitively high. In addition to its Austin operations, Tesla has launched a ride-sharing service in San Francisco, although those vehicles are still operated by human drivers, as the company has not secured the necessary permits for fully autonomous operations in California.
As Tesla pushes forward with its robotaxi dream, it faces fierce competition from other players in the autonomous vehicle market. Waymo, supported by Alphabet, currently dominates the driverless market, operating in five different U.S. cities and recently expanding into Miami. Furthermore, Amazon-owned Zoox has entered the sector, intensifying the competitive landscape.
Consumer sentiment regarding robotaxis remains uncertain, with safety concerns being a significant issue. A survey conducted by the Electric Vehicle Intelligence Report highlights this skepticism among U.S. consumers. Additionally, California regulators have previously found Tesla to have engaged in misleading marketing regarding its driverless capabilities, a situation that has not improved following the launch of the robotaxi service.
In light of these developments, Barclays has raised its price target for Tesla from $350 to $360, maintaining an Equalweight rating on the stock. Currently, Tesla shares are trading at $449.36 with a P/E ratio of 308.95, leading some analysts to suggest that the stock may be overvalued. During his appearance in Davos, Musk also made predictions about the future of AI, claiming it could surpass human intelligence by the end of this year or next, and announced plans to sell Tesla”s Optimus robots to the public by the end of 2027.
In summary, while Tesla”s fully driverless robotaxi service in Austin marks a notable achievement, the company”s ambitious plans face numerous challenges and competition. As the landscape evolves, the market will closely monitor Tesla”s progress and the implications for the broader autonomous vehicle industry.
