Many in the Tesla and electric vehicle (EV) community have eagerly awaited the company’s rollout of a driverless ride-hailing service, and a few recent developments suggest that the company may be considering multiple U.S. cities for early pilot programs.
Tesla is in talks with Austin, Texas officials about rolling out early pilot programs for its self-driving robotaxis as early as next year, as reported by Bloomberg earlier this month, and echoing CEO Elon Musk’s previous aims to launch commercial robotaxis in 2025. As detailed in emails acquired by the publication through public record requests, a Tesla employee has already been discussing the deployment of such fleets since at least May, though the company has also been considering pilot deployment in other Texas cities.
“Tesla is still working to strategically find a city within Texas to deploy… The city of Austin is obviously on our roadmap, but has not yet been decided where we will deploy first as we have many options available,” wrote an employee in one email from November.
The report also said that Tesla reached out to the city of Austin ahead of its October 10 “We, Robot” event, during which it unveiled the Cybercab, and the employee expressed hopes to meet safety expectations in the city of Austin, along with training first responders on how to interact with autonomous vehicles.
Earlier this month, Tesla held an event at its Gigafactory in Austin to help train first responders on its autonomous vehicle technology, though the employee said it wouldn’t yet be used on public roads and would let officials know of any changes to that.
Tesla’s initial ride-hailing pilots could also target California, with internal tests already underway
During the company’s Q3 earnings call in October, Elon Musk also said that employees in the Bay Area, California were already testing ride-hailing services internally. Using the company’s development app, Tesla employees can already request rides and be taken to anywhere in the Bay, according to the CEO.
Both Texas and California cities make sense for Tesla’s initial rollout of commercial robotaxi services, especially given that Musk also said the company aims to debut ride-hailing services and “Unsupervised” Full Self-Driving (FSD) approval in both of these states in 2025, dependent upon regulatory approval. Musk also said that the current internal ride-hailing tests in the Bay Area utilize safety drivers initially, though it isn’t required to do so.
Watch Tesla’s FSD v13.2 navigate away from park in a tricky situation
READ MORE: Tesla is ramping its Cybercab testing sessions at Giga Texas
Earlier this month, a Deutsche Bank report noted that Head of Investor Relations Travis Axelrod said also said Tesla plans to utilize teleoperation during initial rollout of autonomous ride-hailing efforts, as a safety and redundancy measure. This will likely play a role wherever the company first deploys commercial ride-hailing efforts.
Tesla also teased a ride-hailing mobile app in its Q1 Shareholder Deck earlier this year, showing a summon button to order ride-hails, an estimated wait time, climate controls for during the ride, navigation details, and even the ability to select and cycle through music or other media options.
Credit: Tesla
The mobile app avatar showed a Model Y, highlighting the ability for Tesla’s other vehicles to be eligible for ride-hailing operations through the Supervised Full Self-Driving (FSD) program, which is available to any owner who purchases the software through a subscription or one-time purchase.
Tesla Cybercab, Waymo and commercial robotaxis
We also learned in October that the Cybercab features a large touchscreen, in addition to excluding a steering wheel or pedals. You can catch our first ride in the Cybercab below, as captured during Tesla’s October 10 “We, Robot” event in Southern California.
?: Our FULL first ride in the @Tesla Cybercab pic.twitter.com/6gR7OgKRCz
— TESLARATI (@Teslarati) October 11, 2024
Both Texas and California make sense as locations Tesla would deploy early ride-hailing services, especially given its Fremont factory, Palo Alto engineering headquarters, and its competitor Waymo, which already operates paid driverless ride-hailing in San Francisco and Los Angeles.
Although Tesla isn’t expected to enter production with the Cybercab until 2026, the company’s other vehicles could be used to operate commercial self-driving at some point, though it also faces multiple competitors aiming to deploy these services.
Meanwhile, Waymo, the commercial robotaxi company backed by Google parent company Alphabet, has already been operating paid driverless ride-hailing in San Francisco since last year, and it has expanded services to Los Angeles, and Phoenix, Arizona throughout this year. This week, the company said it’s now giving over 150,000 paid driverless rides per week.
Amazon owns the driverless ride-hailing company Zoox, which has recently also gained some ground in deploying commercial self-driving ride-hailing vehicles in the Bay Area.
With General Motors (GM) recently announcing the end of its self-driving arm Cruise, one less future competitor remains for Tesla in the commercial robotaxi space. Musk joining the administration of incoming President Donald Trump is also widely expected to accelerate regulation efforts in the rollout of self-driving technology, though the urgency of the emerging market is quickly becoming clearer.
Still, Musk and Tesla supporters have argued that the company’s FSD will be more scalable than companies like Waymo utilizing geo-mapping efforts, due to its AI neural network model being trained on video footage from real-time drivers across the company’s ownership network. With added safety measures like teleoperation and safety drivers in its early rollout of commercial robotaxi services, Tesla may yet be able to gain enough public and regulatory trust to start deploying these services in the coming months.
What are your thoughts? Let me know at zach@teslarati.com, find me on X at @zacharyvisconti, or send us tips at tips@teslarati.com.
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Tesla (NASDAQ: TSLA) reports its earnings for Q3 today. Here’s what to expect, as the company will reveal its balance sheet after the market closes on Wednesday.
Tesla already reported deliveries just after Q3 ended, and it demolished Wall Street consensus estimates of roughly 462,000 vehicles. Tesla delivered 486,532 cars in the third quarter, which was a big beat, but was down 2.1 percent from the same quarter last year. Energy storage deployments were 13.7 GWh, up year-over-year.
Tesla showrooms picked clean ahead of Q3 end as demand looks strong
For the quarter, analysts have already compiled their predictions for what Tesla will report this afternoon:
- Total Revenues: $28.34B
- Non-GAAP EPS: $0.43
- Operating Margin: 2.5%
- Operating Income: $721M
- Free Cash Flow: ~-$4.51B
Here are a few things we are looking forward to hearing about on the call:
Automotive Gross Margin and Overall Profitability
This was 16.3 percent in Q2, down from 19.2 percent in Q1, and was impacted by warranty charges and some fading regulatory credits. Consensus implies overall gross margin near 18 percent, but a miss here would potentially reinforce concerns about pricing pressure on its vehicles.
Pay attention to energy storage margins as well, especially since Tesla missed GWh expectations, although it was still a strong quarter.
Robotaxi/Cybercab, Unsupervised FSD, and Optimus Progress
The Say questions from retail investors usually focus on these types of projects, and this quarter is no different. Scaling the Cybercab fleet beyond Austin amid the open NHTSA safety review, timeline for Unsupervised FSD in customer cars, Robotaxi unit economics, and Optimus cost per unit plus when it could start generating revenue, are all things to be looking for.
Any concrete timelines or regulatory path details will likely move the stock more than the near-term numbers. SpaceX merger speculation, which was detailed during SpaceX’s earnings call last night, may also surface, although the key details were shared last night.
Elon Musk just confirmed the Tesla and SpaceX merger step everyone was waiting for
Say Investor Questions
- How does the Cybercab fleet scale past Austin, and what’s the regulatory path outside Texas given NHTSA’s open safety review?
- When can we anticipate FSD unsupervised in customer cars?
- When will the CyberCab be available for customer purchase/ownership?
- What’s the unit economics per paid robotaxi mile, and how does it compare to the thirty-cent target?
- Tesla has acknowledged that HW3 vehicles cannot support unsupervised FSD. When will owners know whether they can upgrade their hardware for free, and when will Tesla provide a clear plan?
The full Earnings Call will be streamed this evening after market close around 5 p.m. this evening.
SpaceX confirmed the date of Starship’s 15th launch window with some massive ambitions for the mission, as it will attempt to catch Ship for the first time.
CEO Elon Musk confirmed during SpaceX’s Earnings Call last night on October 20 that it would launch Starship for its 15th test flight in November, and there are some incredible things the company wants to try, making it perhaps the most groundbreaking launch in the program’s history.
SpaceX delivers blockbuster Q3 results as Super Intelligence segment booms
The most major development of the call was SpaceX’s intention to catch Ship alongside catching the Super Heavy Booster, something that has happened in the past. SpaceX showed an animation of the Ship catch, which will be done on the launch tower’s chopsticks:
SpaceX has released a new Starship tower catch animation for the upcoming Flight 15! https://t.co/kStn01Da8u
— Truthful🛰️ (@Truthful_ast) October 20, 2026
This monumental goal is to catch both the Ship and Booster in a dual-catch scenario, an incredible feat since SpaceX has never been able to reuse a Ship after launch. Musk said it would be “the first time that an orbital launch vehicle has been fully recovered,” and said it would be a “profound technology milestone.”
Musk said the odds of success on this first Ship catch attempt are “more likely than not,” but SpaceX is ultimately prepared for more tries moving forward. The SpaceX frontman said that, starting next year, Starship would have a “steady stream” of flights through the end of the year.
The cadence will accelerate in 2027, with Musk stating the company plans to target weekly flights in the first half of 2027 and twice-weekly by year-end.
The Flight 15 attempt follows that of Flight 14, which took off in late September and was Starship’s first orbital mission. It deployed 26 Starlink V3 satellites, accomplished a controlled ocean splashdown of both stages, and shed more light on potential challenges for the program moving forward.
As of now, the Starship program is firing on all cylinders.
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Wall Street analysts rapidly raised price targets on SpaceX (NASDAQ: SPCX) after the company reported a bullish third quarter for 2026 following the market close on October 20. Shares were sent sharply higher in after-hours and premarket trading.
SpaceX posted revenue of $14.6 billion, a 161 percent year-over-year increase that comfortably topped consensus estimates, which fell near $12.7 billion. The company also posted a net profit of $4.4 billion from a prior-year loss, with adjusted EBITDA reaching $8.8 billion.
More price target movement:
🚀 Cantor Fitzgerald lifted its target to $345 from $246 (Overweight).
🚀 Barclays raised its target to $300 from $254 (Overweight).
🚀 Citi increased its target to $240 from $200 (Buy),
🚀 UBS moved to $230 from $210 (Buy)
🚀TD Cowen raised its target to $224 from $200 (Buy).
🚀Morgan Stanley held an Overweight rating with a $300 target.
🚀Other firms also adjusted higher, including Wells Fargo (to $274 from $214) and Clear Street (to $248 from $217). Analysts broadly cited the strong quarterly print, accelerating AI compute expansion, Starlink progress, and Starship milestones as drivers of higher long-term growth and earnings power.— TESLARATI (@Teslarati) October 21, 2026
Its Super Intelligence (AI) division generated roughly $7.6 billion and became the largest revenue contributor, growing nearly 830 percent year-over-year, while the Connectivity segment delivered $5.2 billion on strong subscriber additions that lifted the consumer base to 13.6 million for Starlink.
The Earnings Call proved especially catalytic, as CEO Elon Musk and CFO Bret Johnsen outlined Q1 2027 revenue guidance of $33 billion to $37 billion, which was far above the roughly $22 billion analysts had modeled, alongside fourth-quarter capital-expenditure plans of $35 billion to $40 billion focused on AI compute infrastructure at sites including Memphis and Southaven.
SpaceX delivers blockbuster Q3 results as Super Intelligence segment booms
Management targets 2.5 to 3 gigawatts of nameplate compute capacity by year-end and discussed pathways to 13 gigawatts or more by the end of 2027. Musk described relentless demand from hyperscalers and other customers, with compute pricing supporting payback periods of less than a year and potentially as short as six months.
Additional highlights included Starship’s recent orbital success and V3 satellite deployment, Starlink pricing and enterprise momentum, rapid Grok Bot adoption, spectrum expansion plans, and the formation of special committees to explore a possible combination with Tesla.
These elements prompted a wave of price-target increases:
- JPMorgan more than doubled its target to $500 from $240 while maintaining an Overweight rating.
- Cantor Fitzgerald lifted its target to $345 from $246 (Overweight).
- Barclays raised its target to $300 from $254 (Overweight).
- Citi increased its target to $240 from $200 (Buy),
- UBS moved to $230 from $210 (Buy), and
- TD Cowen raised its target to $224 from $200 (Buy).
- Morgan Stanley held an Overweight rating with a $300 target.
- Other firms also adjusted higher, including Wells Fargo (to $274 from $214) and Clear Street (to $248 from $217). Analysts broadly cited the strong quarterly print, accelerating AI compute expansion, Starlink progress, and Starship milestones as drivers of higher long-term growth and earnings power.
Shares, which closed at $147.79 on October 20, jumped roughly 8 percent in early premarket trading on October 21 as investors digested the results and the newly elevated Street targets.
The average analyst price target has moved higher, which reflects greater conviction in SpaceX’s trajectory across launch, connectivity, and the Super Intelligence business, even as elevated spending remains a point of focus.
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