Tesla’s vision for a self-driving future hinges on the seamless integration of software, regulation, and real-world testing data. A recent report from Reuters, however, suggests a significant disconnect in this equation, particularly in the crucial U.S. market of California. The investigation casts doubt on the company’s regulatory preparedness and highlights a growing gap between its ambitious goals and on-the-ground reality.
A Concerning Lack of Reported Test Miles
According to documents from California’s Department of Motor Vehicles (DMV) reviewed by Reuters, Tesla has not reported a single mile of autonomous testing on public roads in the state since 2019. Cumulatively, the company’s filings with the agency since 2016 amount to just 562 miles.
This finding is critical because establishing a credible regulatory track record is as vital as the underlying technology for any company pursuing autonomous driving in a market like California. A DMV spokesperson confirmed to Reuters that Tesla has not sought permits beyond an initial testing license, which explicitly requires a safety driver behind the wheel.
Impending Rules Raise the Bar Further
Compounding the pressure is a forthcoming regulatory proposal, expected to be finalized later this year. As detailed by Reuters, these new rules would mandate that a provider demonstrate at least 50,000 miles of autonomous driving with a safety driver on public roads before even applying for permission to test without one.
Against this backdrop, Tesla’s current standing in California appears stalled. Bryant Walker Smith, a law professor and autonomous driving expert who has reportedly advised the DMV, offered a pointed assessment to Reuters. He suggested Tesla projects an image that “they are ready and the regulators are not,” while the reality may be that “the regulators are ready, and they are not.”
Legal Dispute Over “Autopilot” Marketing Adds Tension
This news emerges within an already contentious environment in the state. As reported by CNBC and Electrek, Tesla has filed a lawsuit against the DMV. The legal action followed the agency’s conclusion that the marketing of “Autopilot” and “Full Self-Driving” features had been misleading.
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Notably, CNBC reported the lawsuit was filed on February 13, despite Tesla having already implemented corrections requested by the regulator. The DMV confirmed on February 17 that the company had made the required changes: dropping the “Autopilot” name and adding the clarifying label “Supervised” to “Full Self-Driving.” Electrek noted this move helped Tesla avoid a potential 30-day sales suspension in the state. Tesla’s attorneys, according to CNBC, accused the DMV of unfairly and baselessly labeling the company a “false advertiser.”
Current Robotaxi Operations: Limited in Scale
On the operational front, Tesla’s robotaxi efforts remain modest in scope. Reuters indicates a small pilot program is running in Austin, Texas, where regulatory barriers are lower. In the San Francisco Bay Area, what Tesla has launched as a “robotaxi” service is described by Reuters and authorities as more akin to a chauffeur model: humans drive the vehicles, assisted by the Full Self-Driving software.
Meanwhile, competitive pressure is intensifying. Barron’s reported that Waymo has launched operations in 10 U.S. cities. This stands in stark contrast to Tesla’s communicated plan to serve nine cities by the middle of this year.
Share Price Movement Reflects Broader Concerns
Tesla’s equity faced downward pressure in Thursday’s trading session, closing 2.16% lower at 345.80 Euros, according to the provided data. Reuters contextualized this movement within a broader weakening sentiment across the technology sector.
Further underscoring the recent headwinds, the share price now sits approximately 7% below its 50-day moving average, a key technical indicator watched by market participants.
All eyes will now turn to Tesla’s next quarterly results, scheduled for April 21, 2026. Until then, a significant portion of the company’s valuation narrative will likely depend on whether its robotaxi plans can gain tangible substance, especially in the demanding regulatory landscape of California.
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