Tesla Admits Unsolved Unsolved Self-Driving on HW4, Robotaxi in Austin Remains Supervised

Tesla has admitted that unsupervised self-driving is not solved on HW4, contradicting CEO Elon Musk's claim that Robotaxi in Austin uses the same hardware as customer vehicles. The service has a supervisor on board and is not truly unsupervised. Musk had promised unsupervised self-driving for years without delivering, leaving HW3 owners in limbo.

Tesla has recently expanded its Robotaxi service to cover half of the US population by the end of 2025, pending regulatory approvals. However, the company has faced criticism for its claim that the service uses the same hardware as customer vehicles and operates without a supervisor on board. This assertion contradicts the current operational status of the Robotaxi service in Austin, Texas, where the service has a supervisor on board and is not truly unsupervised.

During Tesla's Q2 2025 financial results call, CEO Elon Musk stated that the Robotaxi service would reach this milestone, but regulatory hurdles could pose a significant barrier to scaling [1]. The service is currently operational in a limited area of Austin, Texas, with a fleet of 10-20 Model Y vehicles [2]. Musk also mentioned that the Bay Area would be the first market for expansion, with initial phases requiring a driver in the vehicle [2].

Despite the company's ambitious goals, Tesla has faced challenges in delivering on its promises of unsupervised self-driving. The company's Hardware 4 (HW4) platform, which was supposed to enable unsupervised self-driving, has not been fully implemented in the Robotaxi service. This has left owners of the older Hardware 3 (HW3) vehicles in limbo, as they await the promised upgrade to HW4.

Investors and analysts have expressed mixed reactions to Tesla's recent developments. While some remain bullish on the company's long-term prospects, others have expressed concern about the current state of the Robotaxi service and the company's ability to deliver on its promises. Despite the challenges, Tesla continues to invest in its autonomous vehicle technology and aims to capture a significant share of the robotaxi market.

In the meantime, Tesla faces other challenges, including a decline in year-over-year deliveries and rising competition in the electric vehicle market. The company's recent earnings report indicated a 12% year-over-year decline in revenue to $22.5 billion in the second quarter [2]. Additionally, the company warned that it could face "a few rough quarters" as it weathers shifting tariffs and the end of EV tax credits in the US.

While the future of Tesla's Robotaxi service remains uncertain, the company continues to invest in its autonomous vehicle technology and aims to capture a significant share of the robotaxi market. Investors and financial professionals should closely monitor the company's progress and regulatory approvals to assess the potential impact on the company's financial performance.

References:
[1] https://electrek.co/2025/07/23/elon-musk-with-straight-face-tesla-robotaxi-will-cover-half-us-population-end-year/
[2] https://sea.mashable.com/transportation/38722/tesla-wants-to-offer-robotaxis-to-half-the-population-of-the-us-by-the-end-of-2025