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Tesla Inc. is seeking approval to launch ride-hailing services in California, marking a significant move by Elon Musk’s company to transport paying customers as its conventional car sales decline, according to the Insurance Journal.
The automaker is permitted to test autonomous vehicles with a safety driver in California but lacks the necessary permit from the state's Department of Motor Vehicles for driverless testing or operations— a requirement for launching a driverless taxi service, MSN said.
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According to documents reviewed by Bloomberg, the EV manufacturer submitted an application late last year for a transportation charter-party carrier permit from the California Public Utilities Commission.
This designation would allow Tesla to own and operate its fleet of vehicles.
Over the past year, Musk has shifted Tesla’s focus to robotaxis as demand declines for its aging lineup of electric vehicles—a bold move that has boosted the company’s stock but may encounter regulatory hurdles.
Read more: Elon Musk Announces Tesla's Paid Robotaxi Service Launching in Austin This June.
Investors are banking on the billionaire’s close ties to U.S. President Donald Trump to help streamline the process, MSN said.
Although Tesla did not respond to Reuters regarding a request for comment, the CPUC informed Reuters that obtaining the transportation charter-party carrier permit is a pre-requisite to inheriting authorization to operate an autonomous ride-service, MSN said.
Uber shares briefly dipped into negative territory following the news but were up less than 1% as of 12:57 p.m. in New York. Lyft also trimmed its gains, while Tesla remained largely unchanged, according to the Insurance Journal.
In its discussions with California officials, Tesla addressed driver’s license requirements and drug-testing coordination, indicating plans to use human drivers, at least in the beginning, Bloomberg said.
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