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Tesla’s disruption is making Germany’s elite automakers very tense about the future
There was once a time when Germany’s largest automakers looked on with amusement as Tesla, a small Silicon Valley electric car maker, purchased a gigantic car factory in Fremont, CA to produce its first ground-up premium sedan. Today, amidst the Model 3’s disruption and the impending arrival of the Model Y, it appears that no one in Das Auto is laughing anymore.
Electrification is something that used to be scoffed at, especially among the industry’s serious players. When Tesla was starting out, the transportation sector was still fully committed to the internal combustion engine. And in this era, Germany’s elite three — Daimler, Volkswagen, and BMW — reigned supreme. Their vehicles were sought after, and they were known for their power and pedigree. That was, at least, until upstart companies such as Tesla entered the picture.
Tesla represented everything that legacy auto was not. Instead of relying fully on a vast dealer network, Tesla sold its cars on its own. Instead of relying on a network of suppliers, Tesla adopted a vertically-integrated model. Instead of spamming its cars with all the plush amenities found in traditional luxury cars, Tesla’s EVs were spartan and minimalistic. These little differences, coupled with the fact that its vehicles are unlike any other on the road in terms of performance and tech, made the electric car maker a brand to watch among consumers looking to purchase a vehicle.
What really makes Tesla a pretty concerning opponent is the company’s dedication to its mission — to accelerate the advent of sustainability. This means that the company is about so much more than just profits. It’s a company that is legitimately trying its best to change the world, and it is beckoning everyone for support. And support it has gained. Among automakers, Tesla currently stands supreme according to social media presence. Today, the Model 3 is outselling mainstays like the BMW M3, and the arrival of the Model Y could end up disrupting a market previously held by cars like the Porsche Macan.
Today, Tesla stands as a leader in the EV market, with vehicles that have advanced driver-assist features such as Autopilot, a Full Self-Driving suite that includes capabilities like Smart Summon, and a system that constantly improves through free over-the-air updates. With these, Tesla’s electric cars such as the Model S and Model 3 have dominated their respective EV segments.
So how did Tesla end up disrupting the market even if Das Auto had all the resources all along to beat Tesla at its own game years ago? Perhaps it’s hubris, or maybe it was simply an honest mistake. Nevertheless, Tesla has now reached a point where it would be very difficult to reach and overtake, especially when it comes to the tech and batteries of its vehicles. This was highlighted when Volkswagen reportedly got its hands on a Mid Range Tesla Model 3. After tearing down the vehicle, the veteran automaker was reportedly shocked at how advanced the vehicle was.
Sajjad Khan, a Pakistani-born Daimler executive who is a member of the divisional board for CASE (Connected, Autonomous, Shared, Electric) at Mercedes-Benz, believes that this does not need to be the case. In a recent town hall meeting, Khan told an audience that the time is nigh for Germany’s auto sector to get a wake-up call.
“We need a wake-up call. We have to change fundamentally — as individuals, as departments, as a company, as a country. If we don’t, we’re going to be facing tough times ahead. We need to rebuild the mentality that made the economic miracle (in postwar Germany) possible. And we can’t wait until we have fallen on our faces to do this,” he said.
Fortunately, it may be too premature to dismiss Germany’s veteran automakers and their EV efforts. Porsche proved to the world that it can match and perhaps even exceed the performance of Tesla’s flagship sedan with the Taycan, though it had to make do with significantly less range and a far higher price. Volkswagen, for its part, is spending large amounts in its efforts to produce electric vehicles. The company is looking to conduct its ramp quickly, to the point where it would no longer sell diesel and gasoline cars by 2040.
That’s what one could call the end of an era.
Tesla Full Self-Driving (Supervised) has taken yet another significant step forward in Europe. On May 29, Estonia became the third European Union country to approve the advanced driver-assistance technology, following approvals in the Netherlands and Lithuania.
Tesla Europe announced the news on X, confirming the expansion has continued across the continent that, at one time, seemed to be taking its sweet old time giving any approval to the FSD suite.
FSD Supervised now approved in Estonia🇪🇪. Rollout will begin soon pic.twitter.com/y5a64qlp5m
— Tesla Europe, Middle East & Africa (@teslaeurope) May 29, 2026
Estonia’s Transport Administration (Transpordiamet) granted the approval by recognizing the type certification issued by the Dutch vehicle authority RDW. This mutual recognition mechanism, enabled by EU regulations, allows other member states to fast-track deployment without repeating extensive local testing.
The Estonian authority noted that Tesla’s FSD had undergone rigorous evaluation on European roads for approximately 18 months before the initial Dutch approval in April 2026.
FSD Supervised remains classified as a Level 2 advanced driver-assistance system (ADAS). Drivers must maintain full attention, keep their hands on the wheel, and stay ready to intervene at any moment.
The system assists with tasks such as automatic lane changes, navigation through city streets, and responding to traffic objects, but it does not constitute full autonomy. Estonian officials emphasized this distinction, underscoring that safety responsibility lies entirely with the driver.
The rapid progression across the Baltic region highlights Tesla’s strategic approach to European expansion. The Netherlands provided the foundational type approval in April, unlocking doors for neighboring countries.
Lithuania followed swiftly in mid-May, with rollout beginning shortly thereafter. Estonia’s decision, coming just days later, demonstrates how smaller, digitally progressive nations are accelerating adoption.
Tesla owners in Estonia can expect an over-the-air software update in the coming weeks, bringing the latest FSD capabilities to compatible vehicles
This expansion builds on Tesla’s global momentum. FSD Supervised is now available in 11 countries worldwide, including the United States, Canada, Australia, and South Korea. In Europe, the approvals signal growing regulatory confidence in Tesla’s vision-based AI approach, which relies on cameras and neural networks rather than lidar or radar-heavy alternatives used by some competitors.
For Tesla, these European milestones are more than symbolic. They validate years of data collection and software iteration while opening new revenue streams through FSD subscriptions and purchases.
As the company continues refining its AI models with real-world miles from diverse driving environments, including Estonia’s variable winter conditions, the dataset grows richer, potentially benefiting global users.
Elon Musk has firmly denied recent media reports suggesting that SpaceX has reduced its target valuation for an upcoming initial public offering.
The denial came directly from the SpaceX and Tesla frontman on his social media platform X, where he responded with a single word, “False,” to a post from ZeroHedge that cited Bloomberg sources.
This swift rebuttal underscores Musk’s ongoing effort to manage speculation surrounding one of the most anticipated market debuts in recent history.
False
— Elon Musk (@elonmusk) May 29, 2026
According to the disputed reports, SpaceX had lowered its IPO valuation goal to at least $1.8 trillion from previous ambitions exceeding $2 trillion.
The claims emerged amid growing anticipation for the company’s confidential S-1 filing, which positions it for a potential public listing as early as June.
Some had pointed to strong revenue growth, particularly from the Starlink satellite internet service, which contributed heavily to the firm’s 2025 figures of $18.7 billion. Yet challenges persist in other areas, including substantial investments and losses tied to ambitious projects like Starship development and artificial intelligence initiatives, which plan to make life multiplanetary eventually.
Musk’s response highlights a pattern in which he actively counters what he views as inaccurate portrayals of his companies’ trajectories.
SpaceX, already valued privately at extraordinary levels, stands as a cornerstone of Musk’s empire alongside Tesla and xAI. The entrepreneur has long emphasized the transformative potential of reusable rockets and global broadband access, factors that fuel investor enthusiasm despite operational hurdles.
By rejecting the valuation downgrade narrative, Musk signals confidence in SpaceX’s fundamentals and its readiness for public markets on terms favorable to its long-term vision. People have been waiting a very long time to invest in SpaceX, and the valuation, as well as the introductory share price, is not going to need adjusting.
They’ll have plenty of suitors.
This episode reflects broader dynamics in the technology sector, where rumors often swirl around high-profile entities. Musk’s direct engagement with media narratives serves to maintain transparency and control the narrative around his ventures.
As SpaceX prepares for greater scrutiny in public markets, the founder’s denial reinforces optimism about its prospects. Supporters argue that the company’s innovative edge positions it for enduring success, far beyond short-term valuation debates. With the denial now public, attention turns to forthcoming regulatory filings that could provide clearer insights into SpaceX’s strategy and financial health.
The coming weeks promise to reveal more about how SpaceX will transition into a publicly traded powerhouse.
Tesla’s dreams of operating a fully autonomous ride-hailing platform just took a massive step toward reality, as two separate events have indicated the company is perhaps closer than ever to achieving self-driving as a product.
On Thursday, Tesla was granted authorization by the State of Texas to operate driverless vehicles in a commercial manner. On May 28, Senate Bill 2807, passed by the 89th Texas Legislature, took effect after being passed back on September 1, 2025.
The bill establishes a statewide regulatory framework requiring authorization from the Texas Department of Motor Vehicles for companies to operate automated vehicles commercially on Texas roads.
This covers driverless, or SAE Level 4+, operations for passenger transport, meaning Robotaxi, or freight.
Tesla and other companies can self-certify their vehicles and tech as long as they:
- Operate in compliance with Texas traffic laws
- Maintain proper registration, title, and insurance
- Use compliant automated driving systems
- Record onboard activity and handle system failures and glitches safely.
The new authorization, which was first reported by James Stephenson on X, allows companies to utilize their own processes to determine if their vehicles are ready to operate without drivers.
🚨BREAKING:
Tesla has been authorized by the State of Texas to operate driverless vehicles commercially under the new law that took effect today, May 28th, 2026. Tesla has officially self-certified the software running on its robotaxis as Level 4. $TSLA pic.twitter.com/KSJdsvlaW5— James Stephenson (@ICannot_Enough) May 28, 2026
It is a rule that expedites the entire approval process, keeping agencies out of a usually long, lengthy, and frustrating task that is essential to technological advancements. It essentially means Tesla can launch commercial Robotaxi operations at this point.
On the very same day, Tesla continued the momentum as CEO Elon Musk shared a video of Cybercab units autonomously driving off the property at Gigafactory Texas. This is a major step in the story of the Cybercab.
Mass production of the Cybercab started at Giga Texas in April, and it is already heading out of the factory on its own.
Cybercab driving itself out of the GigaTexas factory pic.twitter.com/EwAMVVDjYy
— Elon Musk (@elonmusk) May 28, 2026
These two major events mark a drastic step forward in Tesla’s progress toward Cybercab and the permissions it needs to operate a self-driving ride-hailing service. Tesla is now able to operate autonomously under Texas law by self-certifying, and with the potentially imminent rollout of Cybercab, Tesla’s autonomous dreams are starting to take serious shape.
Tesla Full Self-Driving expansion in Europe continues with new addition
Elon Musk strikes down reports on SpaceX IPO rumors
