Tesla CEO Musk Adopts Cautious Tone on Slower Robotaxi Rollout

Tesla's rollout of its robotaxi service is advancing slower than expected, with CEO Elon Musk adopting a more cautious tone during the company's first-quarter earnings call on Wednesday. Musk told investors that Tesla hopes to have robotaxis and driverless vehicles operating in a dozen or so states by year's end, emphasizing a cautious approach to prevent injuries or fatalities.

This marks a shift from his statements last July, when he predicted availability to half the U.S. population by the end of the year with hyper-exponential growth.

attributed the slower progress to challenges in scaling self-driving technology, similar to issues faced by competitors like Alphabet’s Waymo. Tesla launched a small-scale pilot in Austin, Texas, last year, but expansion details remain limited. Musk acknowledged past unfulfilled promises on self-driving vehicles, referring to himself in January 2025 as 'the boy who cried wolf' before asserting progress.

On Wednesday, he indicated that robotaxi revenue would not be super material this year but could become significant next year. The company plans to build its robotaxi business around the Cybercab, a two-seater fully autonomous vehicle without a steering wheel or pedals.

Musk stated that Cybercab production has begun, though initial output will be very slow, with exponential growth expected toward the end of the year and into next year.

analyst Seth Goldstein said Tesla is being cautious because the stakes are high, and the company wants to avoid incidents by ensuring 100% confidence in safety. Morgan Stanley analysts, who remain bullish on Tesla’s autonomous ambitions, noted that the robotaxi progress is slower than investor expectations, limiting near-term upside to the stock price.

Tesla shares fell more than 3% in afternoon trading on Thursday. Barclays analysts pointed out that Tesla still operates only a nominal number of driverless vehicles, with investors awaiting a more significant increase.

“The limiting factor for expansion is really rigorous validation, making sure things are completely safe.”

Future Outlook Musk has a history of missing self-driving targets dating back a decade. William Blair analysts described the earnings call as low energy, with Musk striking a reserved and cautious tone on robotaxis. Tesla's $1.5 trillion market value largely hinges on investor belief in a vast robotaxi fleet and autonomous-driving software subscriptions.

The company announced a robotaxi expansion to Dallas and Houston on social media last weekend, but Musk provided no new details during the call. Analysts like those at Morgan Stanley expect patience from investors, as Tesla prioritizes safety amid the complexities of autonomous vehicle development.