“Auto-drive engaged.” That was the command Sylvester Stallone gave in the 1993 film Demolition Man, as he woke up in a super-advanced future with robots driving taxis. And that future could be…any day now.
Tesla is gearing up for the anticipated launch of its autonomous taxi service, dubbed the “robotaxi.” Traders on platforms like Kalshi are placing bets on whether the company will make the service publicly available before January 1, 2026 — and actually giving it a 54% chance.
In late January 2025, Tesla CEO Elon Musk announced plans to initiate a driverless taxi service in Austin, Texas, as early as June 2025. This service aims to utilize Tesla-owned vehicles equipped with the company’s Full Self-Driving (FSD) software, operating without human intervention. Musk emphasized confidence in launching “unsupervised” autonomous ride-hailing, marking a significant milestone in Tesla’s pursuit of self-driving technology.
Despite the ambitious announcement, Tesla has faced headwinds. The company’s stock has experienced a notable decline, with shares dropping over 50% since December. Factors contributing to this downturn include political controversies surrounding Musk’s involvement in governmental roles and concerns over slowing electric vehicle (EV) demand. Additionally, Tesla’s sales in Europe have fallen by 42.6% in the first two months of 2025, even as overall EV sales in the region increased by 28.4%, according to data from European Automobile Manufacturers Association.
Robotaxi predictions
- YES (60¢)
- NO (45¢)
The case for a 2025 robotaxi release
- Tesla continues to push forward its Full Self-Driving (FSD) technology, with Version 12 rolling out to select users in early 2025. The company claims the latest iteration relies entirely on neural nets rather than manually coded rules, a major leap toward full autonomy. Musk has repeatedly stated that Tesla vehicles running FSD will soon be capable of operating with no human supervision.
- The planned rollout in Austin, Texas — where regulatory conditions are more favorable — is seen as a strategic testing ground. Texas law currently permits autonomous vehicle testing without a safety driver, giving Tesla a legal runway to debut its robotaxi service ahead of more tightly regulated states like California or New York.
- From a business standpoint, robotaxis could fundamentally transform Tesla’s model. Rather than selling vehicles to individual drivers, the company could retain ownership and operate a ride-hailing network, generating recurring revenue with higher margins. Musk has long touted the potential for Tesla owners to turn their vehicles into passive income generators on an autonomous fleet — something that could appeal to both investors and consumers if the technology proves reliable.
- Robotaxi success would also strengthen Tesla’s lead in the race for AV dominance, especially as competitors like Waymo and Cruise face mounting scrutiny after safety incidents. A smooth and successful launch — even in one city — could shift public perception, spark media momentum, and attract regulator goodwill.
The case against a 2025 robotaxi release
- Deploying autonomous vehicles requires navigating complex regulations that vary by jurisdiction. Despite promising demos and beta releases, Tesla’s FSD technology has faced criticism for inconsistent performance and lack of independent validation. Regulators have been slow to sign off on the claim of “Level 4” autonomy—vehicles that operate without human attention—especially following high-profile crashes involving Tesla vehicles in Autopilot or FSD mode. Until federal agencies like the National Highway Traffic Safety Administration (NHTSA) give the green light, any robotaxi deployment may remain limited in scope.
- Even in Texas, launching a public-facing autonomous service comes with liability, insurance, and operational risks. Tesla would need to prove not just technological readiness, but also legal defensibility in the case of accidents or software failure.
- Musk’s political affiliations have sparked backlash, potentially impacting consumer sentiment and adoption rates for new services. Elon Musk’s increasingly polarizing political commentary and recent advisory role in a Trump-led policy group have alienated some consumers, particularly in urban centers — the very markets most viable for robotaxi demand. Negative sentiment could stunt adoption and invite heightened scrutiny.
- Meanwhile, competition is heating up globally. Chinese EV giant BYD continues to scale aggressively, and Apple is rumored to be revisiting its autonomous car project. While Tesla still leads on brand visibility and integration between hardware and software, rivals with deeper pockets or political favor could beat them to wide-scale rollout in key markets.
As Tesla endeavors to bring its robotaxi service to market, traders and analysts remain divided on the feasibility of a public release before 2026. The coming months will be critical in determining whether Tesla can overcome technological, regulatory, and market challenges to realize its autonomous ambitions.
