Driverless disruption: Tech titans gird for robotaxi wars with new factory and territories
Waymo, owned by Google's parent company Alphabet, already offers paid autonomous rides in a handful of cities, including San Francisco and Los Angeles. Amazon's robotaxi effort, known as Zoox, opened a new production facility in the Bay Area this week. The company has been testing its unique pill-shaped vehicles in California and Nevada since 2023.
Meanwhile, in Austin, Texas, Elon Musk just started testing driverless Teslas with the hopes of launching a commercial service soon. Musk unveiled a prototype for Tesla's Cybercab late last year, touting his vision for an autonomous future and "an age of abundance."
The arrival of self-driving tech could eventually affect society as much as the internet and smartphones did years ago, some experts predict. With Waymo leading the way and Tesla and Zoox trying to catch up quickly, a new status quo could be on the horizon, said Karl Brauer, an analyst with iSeeCars.com.
"Tesla has tried to catch up, and Zoox is a more recent competitor that's hoping to be a serious player," he said. "Waymo has been slow and steady and, as a result, is winning the race."
According to some industry insiders, the U.S. is about 15 years from seeing widespread use of robotaxis, Brauer said. While Waymo taxis have become a common sight in the cities where they operate, weather conditions and charging infrastructure still limit their expansion.
On Wednesday, Waymo expanded its service area in Los Angeles County, where its vehicles now roam an area of more than 120 square miles. The company also increased its service area in San Francisco, expanding access to suburbs and Silicon Valley.
Days after Waymo's announcement, Zoox opened a 220,000-square-foot facility in Hayward, Calif., that the company says will be able to produce 10,000 robotaxis per year. Zoox is preparing to launch its public ride-hailing service in Las Vegas and San Francisco this year.
Unlike Waymo vehicles, which are retrofitted Jaguars, Zoox is developing a purpose-built taxi with no steering wheel or gas pedals.
Zoox also has a manufacturing plant in Fremont, Calif., where the company develops its test fleets of retrofitted Toyota Highlanders. Tesla has a manufacturing facility in Fremont as well.
Musk has promised for years to deliver autonomous vehicles and a robust ride-hailing service. Lawmakers in Austin requested this week that he delay the rollout of his service in the city.
Tesla, Zoox and Waymo are the three remaining major U.S. companies in what was once a more crowded field, Brauer said. General Motors' autonomous taxi company Cruise suspended operations in 2023 after one of its vehicles struck and dragged a pedestrian in San Francisco. Last year, Uber and Cruise announced a partnership that could put Cruise vehicles back on the road.
A company called Argo AI, backed by Ford and Volkswagen, was also developing driverless technology until it shut down in 2022.
The continued expansion of robotaxis depends on safe and successful testing, Brauer said. There have been several incidents related to Tesla's Full Self-Drive mode, a technology currently available but still in development. Waymo has issued recalls of some of its vehicles on multiple occasions.
"If there's a tragic result for any of these three companies during the testing and development process, it would likely slow down the entire industry," Brauer said.
Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
30 minutes ago
- Yahoo
Tesla shareholder group urges probe, ‘appropriate remedial action' from Nasdaq over Elon Musk's $29 billion pay package
In the latest twist in a long-running battle over Elon Musk's compensation at Tesla, the SOC Investment Group has requested that Nasdaq formally investigate 'and take appropriate remedial action' against Tesla for its recent $29 billion equity grant to the CEO. In a letter to Nasdaq, the group raised concerns about compliance with executive compensation rules and shareholder transparency. The SOC Group, formerly known as the CtW Investment Group, works with pension funds sponsored by a coalition of unions representing over 2 million members; many of those funds are Tesla investors. In a letter dated Aug. 19, 2025, addressed to Erik Wittman, deputy general counsel and head of enforcement at Nasdaq, SOC expressed 'serious concerns' about Musk's new compensation package. Specifically, SOC said it was concerned that Tesla's board circumvented Nasdaq listing rules when awarding Musk a '2025 CEO Interim Award,' disclosed earlier this month. The group claims this equity award should have required a shareholder vote, as stipulated under Nasdaq's rules, given that it materially amended compensation plans. Tesla's board approved Musk's new equity package under the company's 2019 Equity Incentive Plan, largely as compensation for his previously awarded—and overturned—$56 billion options package from 2018, known as the '2018 CEO Performance Award.' That older award was (twice) overturned by the Delaware Chancery Court owing to questions regarding board independence—a decision currently being appealed at the Delaware Supreme Court. Fortune's Shawn Tully reported that the new package will only apply if Musk and Tesla lose on appeal in Delaware. He also noted that unlike with the $56 billion award, the newer $29 billion award includes restrictions that protect shareholders: The shares vest on the second anniversary of the grant, or early August 2027, only if Musk serves for the entire period as CEO or chief of product development or operations. Musk can't sell any of those vested shares until five years later, or on Aug. 3, 2030. Fortune's Amanda Gerut reported that, such restrictions notwithstanding, the package lacks hard performance targets for Musk. Brian Dunn, director of the Institute for Compensation Studies at Cornell University, told Fortune that experts sometimes refer to these as 'fog-the-mirror grants.' In other words: 'If you're around and have enough breath left in you to fog the mirror, you get them.' The objections lobbied by SOC Investment Group in its letter have nothing to do with either feature of the grants. The group argues that the Tesla board dodged shareholder approval for the package, in contravention of Nasdaq listing policy. Tejal Patel, executive director of the SOC Investment Group, told Fortune in an interview that the 'real issue is the fact that the original plan … was pretty clear in the disclosures that the company did not intend to include Elon Musk in that plan.' Acknowledging that such issues are usually raised with the Securities and Exchange Commission, she added: 'Admittedly, this is the first time I've flagged something like this to Nasdaq, [and that's] because it was a very specific listing standard.' Her understanding of the Nasdaq standard is that 'this is exactly what it was designed to avoid.' Shareholders likely 'did not believe' they were voting to approve a new Musk package The SOC Investment Group emphasizes that when Tesla shareholders approved the 2019 Equity Incentive Plan, company disclosures explicitly excluded Musk from eligibility, stating that his compensation would be exclusively tied to the extraordinary 2018 award. 'When shareholders voted on the 2019 Plan it is likely that, based on the available disclosures and research, they did not believe they were voting on an equity plan that would cover compensation to Mr. Musk,' the SOC letter notes, 'precisely because of the 'truly extraordinary' nature of the 2018 CEO Performance Award.' The SOC letter also notes that Tesla's 2019 proxy statement repeated multiple times that the 2019 plan was not intended to cover awards to Musk. Furthermore, the letter mentions that major proxy advisory firms indicated that the 2018 CEO Performance Award was 'intended to be the sole means of compensation for Mr. Musk, relying on the Company's disclosures.' Therefore, SOC writes, the 2025 CEO Interim Award 'appears to expand the class of participants under the 2019 Plan in manner that would be sufficiently material to require a separate shareholder vote.' The letter also warns that Tesla's board has indicated further interim awards could follow, potentially bypassing shareholder votes while the Delaware case, the so-called Tornetta litigation, is pending. The SOC letter urges Nasdaq to act to 'restore 'the rightful balance between shareholder and management's interests,'' prevent dilution, and ensure executive compensation transparency. SOC has 'real concerns over director independence,' Patel told Fortune. 'This is sort of the outcome of having a board that is not independent.' She said her group is concerned with issues over a lack of director independence and the juggling of responsibilities by Elon Musk, and matters have 'come to a head in the last several months.' This timeline overlaps with Musk's brief engagement as a special advisor to the White House, including extensive involvement with the Department of Government Efficiency, or DOGE. The new compensation plan, if anything, 'was an opportunity for the board to get Musk to focus on Tesla, and instead' they've arrived at this package, she said. She also noted that the conditions under which Musk would receive the same pay, even if he was a chief of product development or operations, is 'pretty unheard-of.' A vocal, active shareholder SOC Investment Group has a long and active history of engagement with Tesla, focusing on issues such as executive compensation, governance, board independence, and labor rights. The group has repeatedly opposed large pay packages for Musk—including leading campaigns to encourage shareholders to vote against Musk's $56 billion option award and calling for votes against related awards, especially when it believed proper shareholder approval procedures were circumvented or governance standards were not met. The group has also urged Tesla shareholders to vote against the reelection of certain directors, such as Kimbal Musk and James Murdoch, citing concerns about lack of board independence from Elon Musk and alignment with shareholders' interests. Similar to its current letter to Nasdaq, it has requested investigations by regulators into Tesla's governance practices, arguing that the company's board favors Musk's interests over those of public shareholders. For example, the group asked the SEC to probe Tesla's plan to shrink its board in 2022. The group has also joined with other investors in co-filing shareholder resolutions calling for Tesla to adopt comprehensive labor rights policies, including noninterference with worker organizing and compliance with global labor standards. SOC has been involved in webinars and resolutions highlighting risks related to Tesla's approach to unions and labor issues across several countries. Tesla has not publicly responded to the letter and did not immediately respond to Fortune's request for comment. For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. This story was originally featured on Sign in to access your portfolio
Business Insider
an hour ago
- Business Insider
'Don't Hold Your Breath!' Tesla's (TSLA) Elon Musk Casts Doubt on U.S. Launch of New Model Y L
Tesla (TSLA) recently launched Model Y L, a longer, six-seater version of its best-selling electric SUV, in China. However, CEO Elon Musk has cast doubt on its availability in the United States. The decision is tied to the company's focus on autonomous driving technology. TSLA stock was down about 3% on Wednesday. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. On his social media platform, X, Musk suggested that the Model Y L might not ever be produced for the U.S. market. 'This variant of the Model Y doesn't start production in the US until the end of next year. Might not ever, given the advent of self-driving in America,' he wrote. This reflects Tesla's growing strategy of prioritizing autonomous driving technology over expanding its lineup of human-driven vehicles. Why Tesla Might Skip the U.S. Market Tesla's decision not to prioritize U.S. production of the Model Y L stems from its belief that full autonomy is approaching rapidly. Musk has long argued that building traditional vehicles will become 'pointless' in a self-driving future. TSLA is currently scaling its robotaxi operations, including a limited service in Austin, and plans to launch the Cybercab, a steering-wheel-free autonomous vehicle, next year. This shift raises questions about Tesla's product roadmap as the six-seat Model Y L could have attracted American families seeking a more affordable alternative to the Model X. Model Y L Success in China Priced at about $47,200, the vehicle is built at Tesla's Giga Shanghai factory. The model is equipped with a longer wheelbase, captain's chairs, and a spacious third row, features tailored to Chinese families. Also, it offers Tesla's Full Self-Driving (FSD) capabilities. Importantly, it attracted over 40,000 reservations following the launch, signaling strong demand among Chinese consumers. The launch in China comes as Tesla faces intense competition from local EV manufacturers such as BYD (BYDDF), Xiaomi (XIACF), and XPeng (XPEV). China's EV market is more advanced and highly competitive, with local brands rapidly gaining market share by offering affordable cars packed with self-driving and voice control technologies. Overall, the Model Y L's launch in China is a strategic move to regain market share in the world's most competitive EV market. What Is the Prediction for Tesla Stock? Turning to Wall Street, TSLA stock has a Hold consensus rating based on 14 Buys, 15 Holds, and eight Sells assigned in the last three months. At $307.23, the average Tesla price target implies a 4.34% upside potential. The stock has declined 2.5% over the past six months.
CNBC
an hour ago
- CNBC
Elon Musk must face lawsuit claiming he ran illegal $1 million election lottery
Elon Musk was ordered on Wednesday by a federal judge to face a lawsuit by voters accusing the world's richest person of defrauding them into signing a petition to support the U.S. Constitution for a chance to win his $1 million-a-day giveaway. U.S. District Judge Robert Pitman in Austin, Texas said Jacqueline McAferty plausibly alleged in her proposed class action that Musk and his political action committee America PAC wrongly induced her to provide personal identifying information as part of the giveaway, late in the 2024 election campaign. Lawyers for Musk and America PAC did not immediately respond to requests for comment. Musk founded America PAC to support Republican Donald Trump's successful 2024 presidential run. McAferty, an Arizona resident, said Musk and America PAC induced voters in seven battleground states to sign his petition by promising that $1 million recipients would be chosen randomly, as in a lottery, though the voters had no real chance to collect. She said voters who signed were also required to provide names, addresses, email addresses and phone numbers. In seeking a dismissal, Musk listed several "red flags" as proof he had not run an illegal lottery. He said these included statements that the $1 million recipients were "selected to earn" the money and expected to become America PAC spokespeople, defeating the idea that the payment was a "prize." But the judge cited other statements suggesting the defendants were "awarding" the $1 million, and the money could be "won." "It is plausible that plaintiff justifiably relied on those statements to believe that defendants were objectively offering her the chance to enter a random lottery--even if that is not what they subjectively intended to do," Pitman wrote. The judge was appointed to the bench by President Barack Obama in 2014. Musk had also rejected the suggestion that petition signers suffered harm by providing contact information. Pitman said an expert in political data brokerage could testify what that information was worth for voters in battleground states. The lawsuit was filed on Election Day, Nov. 5, 2024. A day earlier, a Philadelphia judge refused to end Musk's giveaway, saying that city's top prosecutor failed to show it was an illegal lottery. Musk is a Texas resident, and his electric car company Tesla TSLA.O is based in Austin. The case is McAferty v Musk et al, U.S. District Court, Western District of Texas, No. 24-01346.
