Tesla's Growing Risks: Customer Dissatisfaction, Service Gaps, and Autonomous Driving Concerns

In recent years, Tesla has been a darling of the electric vehicle (EV) market, hailed for its innovation and disruption of traditional automakers. However, as the company scales its ambitions—ranging from mass-market EV production to full self-driving (FSD) technology—new risks are emerging that could challenge its long-term sustainability. These include declining customer satisfaction, operational inefficiencies in service infrastructure, and unresolved safety concerns surrounding its autonomous driving systems. For investors, understanding these risks is critical to evaluating whether Tesla's disruptive model can weather the growing pressures of a maturing EV industry.

Customer Satisfaction: A Mixed Picture

Tesla's dominance in the EV market has not been immune to erosion in customer sentiment. While the 2025 J.D. Power U.S. Electric Vehicle Experience (EVX) Ownership Study praised the Tesla Model 3 and Model Y for their performance, range, and software updates, the broader picture reveals cracks in the brand's appeal. In the 2025 APEAL Study, Tesla fell to 10th place among premium brands, a decline from its 2023 ranking. Traditional automakers like Porsche and Rivian now rival Tesla in emotional attachment and feature satisfaction, particularly in areas like interior materials, storage, and usability.

Meanwhile, Tesla's dependability has improved but still lags behind industry leaders. The 2025 Vehicle Dependability Study (VDS) gave Tesla a score of 209 problems per 100 vehicles (PP100), up from 257 in 2023. While this improvement is notable, Tesla remains above the industry average of 202 PP100 and trails behind Toyota (162 PP100) and Lexus (140 PP100). The company's reliance on proprietary software—while a strength in some areas—has not fully resolved long-standing issues with hardware integration and parts availability.

The service gap is particularly acute. Tesla's mobile service model, which prioritizes on-site repairs over traditional dealerships, has struggled to keep pace with demand. As the number of Tesla vehicles on the road grows, wait times for repairs are increasing, frustrating owners. This contrasts sharply with the extensive dealer networks of competitors like Toyota and Ford, which offer more localized and immediate service. For investors, this raises a red flag: can Tesla's service infrastructure scale effectively, or will it become a drag on customer retention and brand loyalty?

Operational Inefficiencies: The Robotaxi Hurdles

Tesla's pivot toward autonomous driving, encapsulated in its FSD and robotaxi initiatives, is both a strategic bet and a potential liability. The Arizona fatal crash in November 2023—where a Tesla Model Y on FSD failed to stop despite clear hazards—triggered a federal probe by the NHTSA. The incident, coupled with subsequent crashes in California, Virginia, and Ohio, has cast doubt on the reliability of Tesla's camera-only approach. Unlike competitors like Waymo, which use radar and lidar for redundancy, Tesla relies solely on vision-based sensors, a strategy critics argue is ill-suited for low-visibility conditions.

The June 2025 Austin robotaxi pilot further exposed operational inefficiencies. Despite Tesla CEO Elon Musk's grandiose claims, the service involved only a handful of Model Ys with human safety operators in the passenger seat. These monitors frequently had to intervene for basic driving errors—such as lane violations and sudden braking—highlighting the system's immaturity. The pilot's limited scope (targeting influencers rather than the public) and reliance on manual oversight undermine its scalability. For investors, the question is stark: Can Tesla's FSD technology overcome these technical and operational hurdles, or will regulatory scrutiny and public skepticism delay—or even derail—its robotaxi vision?

Unproven Safety and Regulatory Risks

The NHTSA's investigation into Tesla's FSD system has added another layer of uncertainty. The agency has requested detailed data on Tesla's sensor limitations, safety protocols, and plans for robotaxi deployment. Tesla's refusal to share granular safety metrics, such as disengagement rates or incident frequencies, has fueled criticism from safety advocates and regulators. Meanwhile, the FSD Community Tracker data reveals a disengagement rate of one critical event every 340 miles, a statistic that grows concerning as Tesla's fleet expands.

Regulatory headwinds could also stifle Tesla's autonomy ambitions. The NHTSA has emphasized that Tesla vehicles are not fully autonomous and require driver attention—a stance that clashes with Musk's public rhetoric about “hands-off” driving. Social media activity, including Musk's lighthearted posts about robotaxi pricing and map expansions, has further muddied the waters. For investors, the risk is clear: regulatory delays or mandates for additional safety features could increase costs and slow Tesla's timeline for monetizing FSD and robotaxi.

Investment Implications: Balancing Optimism and Caution

Tesla's challenges are not insurmountable. The company's improvements in vehicle dependability and its first-mover advantage in the EV market remain strengths. Moreover, its software-driven approach continues to attract a loyal customer base, with 94% of EV owners expressing intent to repurchase electric vehicles. However, the combination of service gaps, unproven FSD technology, and regulatory scrutiny creates a volatile backdrop for long-term growth.

For investors, the key is to weigh Tesla's innovation against its execution risks. The stock has surged over the past three years (), but its valuation remains heavily reliant on future expectations rather than current profitability. If Tesla fails to address its service inefficiencies or resolve safety concerns, the market could react sharply. Conversely, successful scaling of FSD and robotaxi could unlock new revenue streams and solidify Tesla's leadership.

Recommendation: Investors should adopt a cautious approach, allocating only a portion of their portfolio to Tesla while closely monitoring its progress in service expansion, regulatory compliance, and FSD refinement. Short-term volatility is likely, but long-term sustainability will depend on Tesla's ability to balance innovation with operational discipline.

In an industry where margins are thin and competition is intensifying, Tesla's next chapter will be defined not by its past brilliance, but by its capacity to adapt to the realities of a rapidly evolving market.