Tesla faces a new lawsuit alleging severe harassment of Black employees at its Fremont, California factory, as filed by a federal civil rights agency this week.
On Thursday, the U.S. Equal Employment Opportunity Commission (EEOC) filed a lawsuit against Tesla in federal court, claiming that, since 2015, the company’s Black workers have been subject to racist slurs and graffiti, including images of swastikas and nooses, according to a report from Reuters.
The suit is just the latest in allegations of racial discrimination at the automaker’s Fremont, California factory, and it comes just over a week after another lawsuit claiming toxic work environments at Tesla’s factories was dismissed.
According to this week’s lawsuit, Tesla hasn’t investigated the claims of racist conduct since the EEOC first raised them, and it also claims that the automaker has fired some employees who reported cases of harassment. Tesla has said in the past that it doesn’t tolerate any racial discrimination, adding that it takes complaints from its workers very seriously.
The lawsuit comes after it was found that the EEOC was investigating Tesla last year, with the agency saying that it discovered “reasonable cause” to believe the automaker went against federal discrimination laws. The EEOC then tried to enter into a settlement with Tesla, though discussions to settle reportedly failed. Investigations began when EEOC chair Charlotte Burrows filed an internal complaint with the commission, considered a charge against Tesla.
“Every employee deserves to have their civil rights respected, and no worker should endure the kind of shameful racial bigotry our investigation revealed,” Burrows said.
Reuters notes that the EEOC typically settles lawsuits directly with employers, adding that it’s somewhat uncommon for the agency’s cases to make it to trial.
The suit also represents the first set of federal charges brought against Tesla for allegations of racial discrimination, with similar lawsuits previously arising from the state of California and past employees. Stephen Diamond, a Santa Clara University law professor who has previously advised Tesla investors on social responsibility, notes that the escalation to the federal level could make it harder for the automaker to defend itself against allegations of discrimination.
“If the federal government gets involved, it certainly adds credibility to the claims,” Diamond said. “Major institutional investors like pension funds will be very concerned about this type of behavior.”
The lawsuit is seeking to make Tesla pay compensation and punitive damages to an unspecified number of its Black workers at the Fremont location, and it would also force the automaker to improve policies related to discrimination and retaliation.
Tesla also faces a racial discrimination case from the California Civil Rights Department (DCR), which is considered a counterpart of the EEOC’s on the state level. That particular suit alleges that Tesla discriminated against Black workers in decisions about wages, promotions and general work assignments. Tesla requested that the DCR dismiss the case last year, saying it was politically motivated, though a judge denied the request.
In addition, a former Black contract elevator operator at the Fremont factory, Owen Diaz, is now seeking his third trial with Tesla from a 2017 lawsuit alleging racial discrimination. In the suit, Diaz said he was told to “go back to Africa” and was called the N-word without any action taken by the automaker despite his repeated complaints. A jury awarded Diaz $3.2 million in April after he rejected a separate payout in 2021 that the judge had reduced from $137 million to $15 million.
Tesla is also facing a class-action lawsuit from around 240 employees in California, claiming that the company mistreated Black workers at the Fremont factory.
Former Tesla employee looks to add almost 240 plaintiffs in racism lawsuit
What are your thoughts? Let me know at zach@teslarati.com, find me on X at @zacharyvisconti, or send your tips to us at tips@teslarati.com.
Tesla has officially launched public Robotaxi rides in Austin, Texas, without a Safety Monitor in the vehicle, marking the first time the company has removed anyone from the vehicle other than the rider.
The Safety Monitor has been present in Tesla Robotaxis in Austin since its launch last June, maintaining safety for passengers and other vehicles, and was placed in the passenger’s seat.
Tesla planned to remove the Safety Monitor at the end of 2025, but it was not quite ready to do so. Now, in January, riders are officially reporting that they are able to hail a ride from a Model Y Robotaxi without anyone in the vehicle:
I am in a robotaxi without safety monitor pic.twitter.com/fzHu385oIb
— TSLA99T (@Tsla99T) January 22, 2026
Tesla started testing this internally late last year and had several employees show that they were riding in the vehicle without anyone else there to intervene in case of an emergency.
Tesla has now expanded that program to the public. It is not active in the entire fleet, but there are a “few unsupervised vehicles mixed in with the broader robotaxi fleet with safety monitors,” Ashok Elluswamy said:
Robotaxi rides without any safety monitors are now publicly available in Austin.
Starting with a few unsupervised vehicles mixed in with the broader robotaxi fleet with safety monitors, and the ratio will increase over time. https://t.co/ShMpZjefwB
— Ashok Elluswamy (@aelluswamy) January 22, 2026
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
The Robotaxi program also operates in the California Bay Area, where the fleet is much larger, but Safety Monitors are placed in the driver’s seat and utilize Full Self-Driving, so it is essentially the same as an Uber driver using a Tesla with FSD.
In Austin, the removal of Safety Monitors marks a substantial achievement for Tesla moving forward. Now that it has enough confidence to remove Safety Monitors from Robotaxis altogether, there are nearly unlimited options for the company in terms of expansion.
While it is hoping to launch the ride-hailing service in more cities across the U.S. this year, this is a much larger development than expansion, at least for now, as it is the first time it is performing driverless rides in Robotaxi anywhere in the world for the public to enjoy.
Tesla has scheduled its Earnings Call for Q4 and Full Year 2025 for next Wednesday, January 28, at 5:30 p.m. EST, and investors are already preparing to get some answers from executives regarding a wide variety of topics.
The company accepts several questions from retail investors through the platform Say, which then allows shareholders to vote on the best questions.
Tesla does not answer anything regarding future product releases, but they are willing to shed light on current timelines, progress of certain projects, and other plans.
There are five questions that range over a variety of topics, including SpaceX, Full Self-Driving, Robotaxi, and Optimus, which are currently in the lead to be asked and potentially answered by Elon Musk and other Tesla executives:
- You once said: Loyalty deserves loyalty. Will long-term Tesla shareholders still be prioritized if SpaceX does an IPO?
- Our Take – With a lot of speculation regarding an incoming SpaceX IPO, Tesla investors, especially long-term ones, should be able to benefit from an early opportunity to purchase shares. This has been discussed endlessly over the past year, and we must be getting close to it.
- When is FSD going to be 100% unsupervised?
- Our Take – Musk said today that this is essentially a solved problem, and it could be available in the U.S. by the end of this year.
- What is the current bottleneck to increase Robotaxi deployment & personal use unsupervised FSD? The safety/performance of the most recent models or people to monitor robots, robotaxis, in-car, or remotely? Or something else?
- Our Take – The bottleneck seems to be based on data, which Musk said Tesla needs 10 billion miles of data to achieve unsupervised FSD. Once that happens, regulatory issues will be what hold things up from moving forward.
- Regarding Optimus, could you share the current number of units deployed in Tesla factories and actively performing production tasks? What specific roles or operations are they handling, and how has their integration impacted factory efficiency or output?
- Our Take – Optimus is going to have a larger role in factories moving forward, and later this year, they will have larger responsibilities.
- Can you please tie purchased FSD to our owner accounts vs. locked to the car? This will help us enjoy it in any Tesla we drive/buy and reward us for hanging in so long, some of us since 2017.
- Our Take – This is a good one and should get us some additional information on the FSD transfer plans and Subscription-only model that Tesla will adopt soon.
Tesla will have its Earnings Call on Wednesday, January 28.
Elon Musk shared an incredible detail about Tesla Cybercab’s potential efficiency, as the company has hinted in the past that it could be one of the most affordable vehicles to operate from a per-mile basis.
ARK Invest released a report recently that shed some light on the potential incremental cost per mile of various Robotaxis that will be available on the market in the coming years.
The Cybercab, which is detailed for the year 2030, has an exceptionally low cost of operation, which is something Tesla revealed when it unveiled the vehicle a year and a half ago at the “We, Robot” event in Los Angeles.
Musk said on numerous occasions that Tesla plans to hit the $0.20 cents per mile mark with the Cybercab, describing a “clear path” to achieving that figure and emphasizing it is the “full considered” cost, which would include energy, maintenance, cleaning, depreciation, and insurance.
Probably true
— Elon Musk (@elonmusk) January 22, 2026
ARK’s report showed that the Cybercab would be roughly half the cost of the Waymo 6th Gen Robotaxi in 2030, as that would come in at around $0.40 per mile all in. Cybercab, at scale, would be at $0.20.
Credit: ARK Invest
This would be a dramatic decrease in the cost of operation for Tesla, and the savings would then be passed on to customers who choose to utilize the ride-sharing service for their own transportation needs.
The U.S. average cost of new vehicle ownership is about $0.77 per mile, according to AAA. Meanwhile, Uber and Lyft rideshares often cost between $1 and $4 per mile, while Waymo can cost between $0.60 and $1 or more per mile, according to some estimates.
Tesla’s engineering has been the true driver of these cost efficiencies, and its focus on creating a vehicle that is as cost-effective to operate as possible is truly going to pay off as the vehicle begins to scale. Tesla wants to get the Cybercab to about 5.5-6 miles per kWh, which has been discussed with prototypes.
Additionally, fewer parts due to the umboxed manufacturing process, a lower initial cost, and eliminating the need to pay humans for their labor would also contribute to a cheaper operational cost overall. While aspirational, all of the ingredients for this to be a real goal are there.
It may take some time as Tesla needs to hammer the manufacturing processes, and Musk has said there will be growing pains early. This week, he said regarding the early production efforts:
“…initial production is always very slow and follows an S-curve. The speed of production ramp is inversely proportionate to how many new parts and steps there are. For Cybercab and Optimus, almost everything is new, so the early production rate will be agonizingly slow, but eventually end up being insanely fast.”
BREAKING: Tesla launches public Robotaxi rides in Austin with no Safety Monitor
Tesla Earnings Call: Top 5 questions investors are asking
