Tesla is eyeing the future, ready to shake up the streets of Austin, Texas, with its new line of self-driving cars, seeking to challenge Waymo’s dominance in the robotaxi industry. During 2024’s fourth quarter earnings call, Tesla CEO Elon Musk announced that the company would introduce the new fleet by mid-June 2025. The service will allow users to order a robotaxi, similar to how they would use an Uber.
Self-driving cars are ‘critical’ to Tesla’s future
While Tesla’s fourth quarter profits didn’t meet expectations, Musk believes these self-driving vehicles are key to sustaining the company’s future. Analysts agreed, noting that Tesla’s software and the prospects of autonomous technology are helping maintain strong profits.
Although Texas is the first stop for Tesla’s robotaxi service, the company plans to expand to California and other U.S. cities by the end of the year.
Competition with Waymo
Tesla’s new fleet will directly compete with Waymo, which already operates robotaxis in California. Tesla’s entry into the market will add pressure on Waymo, especially in cities where it operates, such as Los Angeles and San Francisco.
This week, Waymo, the Alphabet-owned company, announced it would expand its autonomous vehicles to 10 more cities in 2025, including Las Vegas and San Diego. Waymo is already operational in Phoenix, with plans to enter Atlanta and Miami soon.
Autonomous vehicle industry growth
According to data from Research and Markets, the autonomous vehicle industry is gaining momentum, with an estimated market growth of 29% annually. Both Tesla and Waymo are emerging as key players in the growing industry.
As autonomous vehicles grow in popularity, lawmakers in states like Virginia, California and Maryland are moving to regulate them. Current legislative efforts focus on liability in accidents, weight limits and manufacturer responsibilities.
In addition to its robotaxi fleet, Tesla is planning to launch its Cybercab model, another autonomous vehicle. However, this model does not have a steering wheel. Production is expected to begin in 2026.