Is Tesla’s Future as a Car Company, or a Services Company?

By Karan Singh
Robotaxi concept idea
Robotaxi concept idea
SugarDesign

With Tesla’s highly anticipated Robotaxi event just a couple of months away on 8/8, and the Robotaxi itself expected to come to market in 2025 or 2026, the question arises: what is Tesla’s future direction?

Will they continue to produce cutting-edge cars, or will they pivot toward a future where car ownership may no longer make sense?

Advantages of Robotaxi

One of Tesla’s upcoming focuses is bringing the price per mile for its Robotaxi network down to one that rivals bus tickets in major cities. Achieving this is quite an engineering and software feat and something that could still be years away.

But what about the Robotaxi itself? Will the advent of cheap, quickly available robotic taxis in cities and suburbs drive away car ownership in urbanized areas?

Tesla's robotaxi concept
Tesla's robotaxi concept
Not a Tesla App

The potential for Tesla’s Robotaxi service to transform what we currently know as urban mobility is immense. By offering a cost-effective, convenient, and eco-friendly alternative to traditional car ownership, Tesla could change how people navigate cities. The allure of summoning a cheap, quick, and clean Robotaxi could reduce car ownership in cities, alleviate traffic congestion, reduce pollution, and ease parking issues in urban areas.

Moreover, if Tesla succeeds in reducing the price per mile to be competitive with, or even cheaper than mass transit options, the financial incentive to abandon car ownership could become even stronger. For many urbanites, the expenses associated with car ownership – such as insurance, parking, maintenance, charging or fueling costs, and the upfront purchase – can be prohibitive. Robotaxis could tip the balance by providing a seamless, on-demand transportation solution without these additional expenses.

Trust in Robotaxis

Tesla's robotaxi app
Tesla's robotaxi app
Not a Tesla App

However, there are significant obstacles between Tesla and its rosy Robotaxi future. Regulatory and societal hurdles loom ahead on the horizon. From a regulatory perspective, getting Robotaxi services approved will be a major challenge, as Tesla’s autonomous competitors have found themselves operating in regulatory grey zones. Governments will need to develop new frameworks to accommodate and oversee the deployment of autonomous vehicles, ensuring they meet safety and operational standards.

Societally, people will need to adapt to the idea of letting a computer drive them around. This transition can be challenging; even Tesla has found it difficult to convert those offered the FSD V12 trial into paying subscribers. Building trust in autonomous vehicle technology is crucial for the mass adoption of Robotaxi services. Outside of diehard fans and tech enthusiasts, the general public will need to be convinced of the safety and reliability of autonomous vehicles.

Ensuring that Tesla’s reputation for safe vehicles transfers to Robotaxi and FSD will be essential. Tesla must demonstrate the consistent safety and reliability of its Robotaxis to gain this trust.

Reducing Parking & Increasing Drop Off Zones

Moreover, the presence and availability of Robotaxis required to displace car ownership in urban centers will necessitate substantial infrastructure investment and acceptance by local governments. Tesla has already deployed an impressive Supercharger network, but the scale required for a fully operational Robotaxi network is much larger. This will mean developing parking garages and charging stations in urban centers, located in centralized areas to ensure ease of access for Robotaxis.

Additionally, integrating Robotaxis into the existing urban fabric will require collaboration with city planners and local authorities. They will need to address concerns about traffic flow, designated pickup and drop-off points, and the overall impact on public transportation systems. The seamless integration of Robotaxis into cityscapes will be critical for their success.

In short, while the promise of Tesla’s Robotaxi network is transformative, achieving this vision will require overcoming significant technical, regulatory, and societal challenges. If Tesla can navigate these obstacles, the benefits of a cost-effective, convenient, and eco-friendly transportation alternative could revolutionize urban mobility, reduce car ownership, and contribute to a more sustainable future.

The interior of Tesla's upcoming robotaxi, named Cybercab
The interior of Tesla's upcoming robotaxi, named Cybercab
Not a Tesla App

Tesla as a Car Company

Today, Tesla is still fundamentally a car company. It produces five different consumer vehicles: the Model S, Model 3, Model X, Model Y, and the Cybertruck. Of these, the Model Y achieved remarkable success in 2023, becoming the best-selling vehicle in the world, a significant milestone for an electric vehicle (EV). This success underscores Tesla’s engineering and design prowess, demonstrating its ability to create vehicles that appeal to everyday consumers.

Tesla’s focus on innovation and pushing the boundaries has set it apart in the automotive industry. The company revolutionized car manufacturing with its Gigacasting process, which allows large sections of the vehicle to be made from single pieces of cast aluminum. This innovation reduces complexity, increases production efficiency, and lowers costs. Tesla continues to innovate with its Unboxed vehicle assembly process, further streamlining production. Tesla’s vertically integrated approach is unique in the industry, minimizing reliance on third-party suppliers for vehicle subcomponents. This strategy enhances quality control and allows for faster implementation of new technologies. The Gigafactory model, established by Tesla, plays a crucial role in this approach. Located in the United States, China, Germany, and soon in Mexico, these Gigafactories are not just manufacturing hubs; they are centers of innovation. They serve as test beds for updated production processes and vehicle designs and are sites for subcomponent and battery assembly.

Beyond their manufacturing capabilities, each Tesla vehicle is an engineering marvel. Tesla’s cars consistently score some of the highest ratings in safety tests, reflecting the company’s commitment to building safe vehicles. Their performance is equally impressive; for example, the updated Model 3 Performance boasts an impressive 0-60 mph acceleration time. Tesla also continues to push the envelope with forthcoming models, such as the eagerly anticipated updated Roadster, which promises to deliver unparalleled performance.

Tesla has set industry standards in several key areas, including over-the-air updates, battery performance, acceleration, range, and user experience. The ability to receive software updates remotely keeps Tesla vehicles current and continuously enhances the user experience. The company leads in battery technology, offering some of the best range and performance metrics in the industry. Tesla’s vehicles are known for their impressive acceleration and long driving ranges, making them not only environmentally friendly but also highly practical and enjoyable to drive. Furthermore, Tesla excels in providing a superior user experience, both in the vehicle and during the shopping process, with minimalist, high-tech interiors and intuitive user interfaces.

Tesla Challenges

However, Tesla faces significant challenges as it continues to grow. The automotive industry is fiercely competitive, with both established automakers and new entrants ramping up their EV offerings. Companies like Ford, General Motors, Volkswagen, and Rivian are investing heavily in electric vehicle technology and infrastructure, intensifying the competition. There are also upcoming Chinese EV companies making strides in both battery tech and additionally, the global transition from internal combustion engine vehicles to electric vehicles is still in its early stages. Broader adoption of EVs depends on various factors, including government policies, the development of charging infrastructure, and changing consumer preferences. Tesla’s ability to influence and adapt to these factors will be crucial for its sustained growth as a car manufacturer. 

Wrapping it all together, while Tesla is exploring new avenues as a services company, its core identity as a car manufacturer remains robust. The company’s success with the Model Y and its innovative manufacturing practices highlight its strength in the automotive sector. As Tesla continues to push the boundaries of electric vehicle technology and manufacturing, it solidifies its position as a leader in the industry and sets the stage for future growth.

NHTSA Probes Tesla’s Robotaxi Plans; Seeks Answers on FSD in Poor Weather

By Karan Singh
Not a Tesla App

As anticipation builds for Tesla’s Robotaxi network debut in Austin, potentially just a few short weeks away, the National Highway Traffic Safety Administration (NHTSA) is turning its official eye onto Tesla. The ask? How will Tesla’s FSD handle the unpredictable realities of challenging weather?

The NHTSA Request

The NHTSA has sent a formal letter to Tesla, which was made public on May 12th, requesting detailed information about Tesla’s Robotaxi service. The NHTSA inquiry centers specifically on the safety and performance of FSD when faced with reduced visibility conditions like rain, fog, and sun glare. The request is tied to an ongoing NHTSA investigation, which was initiated in October 2023, examining Tesla’s FSD and Autopilot suite following incidents in poor visibility.

Tesla’s executives, including Elon Musk, have previously stated that the company is full steam ahead to launch Robotaxi in Austin this June. However, NHTSA’s pointed questions come even as Tesla has recently discussed its plans to work on region-specific and weather-specific FSD training.

Tesla’s executive leadership acknowledged the need to adapt the system to diverse environmental and weather conditions. Now, regulators want specifics on how Tesla intends to address environmental conditions and how that translates to operational safety for the fleet.

Request Breakdown

NHTSA’s letter outlines a need for detailed information from Tesla before the service launches and covers several key areas. We’ve broken this down into various sections below:

Deployment Scale

NHTSA is looking for the exact number of vehicles and models that will be part of the initial Austin fleet, and what the projected service availability times would be for said fleet. Tesla has previously said it’d launch with 10-20 Model Ys, but looks like NHTSA is looking for additional details.

Oversight

In terms of oversight, NHTSA is looking to confirm whether the Robotaxis will operate under real-time supervision of Tesla’s employees, either remotely or in-vehicle.

This is a question on our minds as well. A recent app update suggested that Tesla could have a driver in the vehicle, but it wasn’t clear whether this was referring to Tesla’s own fleet or customer-owned vehicles. The only thing we have heard officially from Tesla is that Tesla “may” use remote support, but that they were still looking into it.

Adverse Weather Capabilities

This is the meat and potatoes of the request - how will Tesla ensure safety during sun glare, fog, heavy rain, snow, or dust? What specific protocols are triggered if poor visibility is encountered mid-trip? Will the vehicle pull over or call home and cancel rides?

Sensor Technology

Surprisingly, NHTSA is looking for details regarding the vehicle the Robotaxi sensor suites and how Tesla intends to use those sensors to ensure safe operation under varied conditions. NHTSA has had previous submissions from Tesla in regard to its sensor suite and how it uses the technology, so it feels odd that they are requesting another batch - but this could be related to the use of the next generation of FSD (Unsupervised).

Compliance

Does Tesla’s FSD system adhere, either fully or partially, to established industry standards for autonomous driving? This likely refers to the NHTSA Automated Vehicles for Safety guidebook, which lays out the “L0 to L5” driver assistance vs automation system.

Future Expansion

Finally, NHTSA is looking for the timeline for enabling Robotaxi functionality on vehicles not directly owned or controlled by Tesla. Tesla has already come out and said that customer-owned vehicles wouldn’t be allowed on the robotaxi network until 2026, but obviously, NHTSA wants to hear directly from Tesla and likely has more specific questions covering a wide variety of potential issues.

These questions will likely have to be answered with considerable amounts of data and justification for the NHTSA. Once all that is done, Tesla will be in a better position to receive regulatory approval at a larger scale than just within the city of Austin or the state of Texa with the NHTSA’s backing.

Successfully addressing this letter will be the key for Unsupervised FSD moving forward, but Tesla hasn’t issued a public response to the agency’s letter, and likely won’t in a public manner. So we’ll have to wait and see how the launch of the Robotaxi network pans out next month.

FSD V13.2.9 Rolls Out for HW4 as Part of Tesla’s 2025.14.6 Update

By Karan Singh
Not a Tesla App

After an 84-day wait since the last FSD update, Tesla has finally begun rolling out a new version of FSD V13 to its AI4-equipped vehicles. This new release, V13.2.9, is rolling out to all vehicles, including the Cybertruck.

Unfortunately, since it’s a minor point release (from V13.2.8), the release notes are the same, and Tesla hasn’t included a change log or changed what’s coming in the future.

Software Update 2025.14.6

The FSD update is rolling out with Tesla software update 2025.14.6. Interestingly, update 2025.14.6 is seeing a wider distribution and is also being made available to vehicles without FSD and outside North America. For those vehicles, this update just includes bug fixes.

TCU Fix

There’s one fix in particular that’s expected to be included in this update, according to a message from Tesla Service. In earlier 2025.14 updates, there was a bug in some vehicles that prevented some vehicles from falling asleep properly due to a Telematics Control Unit (TCU) issue. This bug caused additional battery drain since some of the vehicle’s systems remained on.

Tesla Service said they planned to include a bug fix in update 2025.14.6, but it hasn’t been confirmed whether the fix actually made it out in this release.

Early Access Users and More

FSD v13.2.9 was first rolled out to Tesla’s standard Early Access group, including well-known community members and content creators. It has also reached participants in the newer, Texas-based Early Access Program, suggesting that the update is relatively stable and may serve as a foundation for upcoming FSD releases.

Tesla could be intending to use the Texas Early Access Program to test various features, perhaps related to the upcoming Robotaxi network launch in Austin. While this is plausible, it is merely speculation, and we’ll be keeping a close eye on that group to see what exactly Tesla does.

HW3 Users

While Tesla has recently been including FSD updates for HW3 and HW4 in the same release, this update does not include any changes for HW3 users. HW3 vehicles that are receiving this update are staying on FSD V12.6.4, which means that whichever fixes this update includes they’re specific to FSD V13 or HW4.

Point Release - Not Much New

Being a point release, V13.2.9 isn’t expected to introduce any major new capabilities. Tesla hasn’t provided specific release notes detailing changes from V13.2.8.

Hopefully, Tesla has taken into account recent user feedback on V13.2.8 about lane centering and lane selection, and this update addresses some of those issues. However, early feedback is that those issues are still present.

There is always potential for a more substantial update in the near future, so keep your fingers crossed, but after such a long wait, we expected more to be included. It seems like Tesla may have felt the need to address a bug in this release instead of waiting for the next major release, which is expected to either be FSD V13.3 or FSD V14.

Update 2025.14.6

FSD Supervised 13.2.9
Installed on 6.3% of fleet
445 Installs today
Last updated: May 14, 11:25 am UTC

Roll Out

The fact that Software Update 2025.14.6 is going out wider than the Early Access audience suggests that Tesla is confident in this release and that it likely only includes very minor changes. We expect this update to continue going out over the coming days.

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