Tesla shares rose 10% on Monday after the company began testing a self-driving taxi service in Austin, Texas, over the weekend. The pilot marked the first time Tesla vehicles carried paying passengers without a human driver, offering rides for $4.20 in a limited area.
The test comes as Tesla shifts focus toward autonomous vehicles and robots, moving away from its earlier plan for dominance in the electric vehicle market. The shift follows growing competition from Chinese EV makers and slowing demand for Tesla’s current lineup.
Videos posted on social media showed the robotaxis navigating city streets and reacting to traffic, parked cars, and pedestrians. The company used around 10 vehicles, each with a front-seat rider acting as a safety monitor.
Tesla will face new state regulations in Texas starting September 1. The law will require permits for self-driving vehicles and set conditions for their operation.
The robotaxi trial is seen as a key step in a long development process. Tesla, along with companies like Waymo, has faced investigations and recalls related to autonomous vehicle safety.
Tesla’s approach relies mostly on cameras and artificial intelligence, avoiding the use of additional sensors like lidar and radar. Critics have pointed out that such systems may struggle in conditions like fog, rain, or glare.
Despite concerns, Tesla’s stock gain on Monday could add nearly $100 billion to its market value, bringing it close to $1 trillion. The stock is still down around 12% for the year, partly due to demand concerns and CEO Elon Musk’s political positions.
Tesla currently trades at nearly 149 times forward earnings estimates, much higher than rivals like Ford and large tech firms such as Microsoft.
