Tesla launches test run for FSD Supervised, an AI-powered ride hailing service

Robot taxis are closer to becoming a reality, after Tesla launched a full self-driving (FSD) supervised ride-hailing service in Austin and San Francisco Bay Area "for an early set of employees."

The announcement was made on Wednesday on X.  

"We've completed over 1.5k trips & 15k miles of driving," the social media post said. "This service helps us develop & validate FSD networks, the mobile app, vehicle allocation, mission control & remote assistance operations."

The U.S. electric vehicle maker is committed to launching the service in Austin by June, Reuters reports. 

ACTIVISTS PLACE ELON MUSK SALUTE CUTOUTS ON TESLA CHARGERS, VIDEO SHOWS

CEO Elon Musk promised during Tesla's latest earnings call that autonomous vehicles will "move the financial needle in a significant way" by late next year.

On Tuesday's call, Musk said Tesla will first use existing Model Y vehicles outfitted with self-driving software. The automaker is also developing a dedicated autonomous model, dubbed the Cybercab, with production starting next year.

TESLA EARNINGS FALL SHORT; ELON MUSK SAYS DOGE TIME WILL 'DROP SIGNIFICANTLY'

Musk said he expects autonomous driving technology will begin to "affect the bottom line of the company, and start to be fundamental" by the second half of 2026.

"I predict that there will be millions of Teslas operating fully autonomously in the second half of next year," he said.

As its core automotive business struggles, with vehicle sales down 13% in the first quarter, expectations are high for Tesla to prove it can overcome the technological hurdles of autonomous driving and demonstrate a sound business model for driverless car services.

Most bullish investors and analysts tie the bulk of Tesla's stock value to its plans for a massive robotaxi and autonomous-driving subscription business.

Investors and analysts in the next few months will be looking for concrete signs that Tesla can scale the robotaxi business and navigate technical challenges.

Blake Anderson, associate portfolio manager at Carson Group, a Tesla investor, said in the coming months he wants to see specifics such as how much Tesla will charge per mile in Austin, and whether that could be profitable. He also wants more details on Tesla's safety record and how frequently its vehicles in Austin have to disengage from autonomous driving mode.

CLICK HERE TO READ MORE ON FOX BUSINESS

"Safety is the thing they control the most, so I want proof that what they do control is ironed out," Anderson said, according to Reuters. "Then I have a much greater line of sight into the national rollout."

Others are less convinced by Musk's prediction that robotaxis will play a material role in earnings by the second half of next year. Musk on Tuesday's call said the Austin robotaxi launch would start with 10 or 20 Model Y vehicles, and that Tesla would "scale it up rapidly after that," expanding to other U.S. markets later in the year.

Reuters contributed to this report.