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Tesla is on track to begin testing its long-awaited robotaxi service in Austin, Texas, by the end of June, according to CEO Elon Musk, despite safety concerns raised by a US regulator.
Musk told CNBC in an interview that the electric vehicle company will start with approximately ten self-driving cars in different sections of the city and increase to about a thousand within a few months.
"We are actually going to deploy not to the entire Austin region, but only the parts that are the safest."
Tesla sales have declined globally due to increased competition, while Musk confronts criticism for his right-wing political beliefs and work for US President Donald Trump.
Musk has stated that he will limit his efforts for Trump and focus on Tesla. "My rough plan on the White House is to be there for a couple days, every few weeks, and to be helpful where I can be helpful," according to him.
A successful robotaxi trial is critical for Tesla, since Musk has switched the company's attention away from developing a new, cheaper EV platform and toward establishing the robotaxi service and its Optimus humanoid robots. That bet accounts for a significant portion of Tesla's capitalization.
"The only things that matter in the long term are autonomy and Optimus," Musk told CNBC on Monday.
Autonomous car technology has proved difficult to commercialize, with strict rules and high costs pushing several businesses to abandon up. Those who remain in the contest, notably Alphabet's Waymo, have received heightened scrutiny.
Since October, the National Highway Traffic Safety Administration has been examining incidents using Tesla's full self-driving (FSD) advanced driver assistance software on roads with low visibility. Last week, the US Department of Transportation ordered Tesla to respond to concerns about the debut of its paid robotaxi service in order to assess how well the cars will operate in severe weather.
Tesla has in conversations with major manufacturers about licensing the FSD software that is likely to power its robotaxis, Musk added.
Musk's xAI firm has been increasing data center capacity to train more complex models to support his larger artificial intelligence goal, and its supercomputer cluster in Memphis, Tennessee, known as "Colossus," is advertised as the world's largest.
xAI will use a million of Nvidia's advanced Blackwell processors at a new factory near Memphis, Musk announced. "So long as Nvidia is better than what we make, we'll keep buying from Nvidia," he told me. The Greater Memphis Chamber announced in March that xAI had purchased a one-million-square-foot property in Southwest Memphis, Tennessee.
Musk, who combined xAI with his social media platform X in March, stated that a merger between Tesla and xAI was not currently being discussed but was "not out of the question," though shareholder permission would be required.
