Palo Alto May Open Streets To Tesla Robotaxis, But California Regulators Will Decide Fate

Palo Alto city leaders are reportedly exploring a deal with EV giant Tesla Inc. TSLA where the company tests its robotaxis on the city’s streets.

What Happened: The city recently held a preliminary discussion with Tesla, Palo Alto Online reported, citing city spokesperson Meghan Horrigan-Taylor.

The deal will not replace the existing taxi service in the city but supplement it, the report said.

However, it added that the deal with Tesla is far from certain given that the California Public Utilities Commission and the California Department of Motor Vehicles are the regulatory bodies responsible for approving the operation of autonomous vehicles in the state of California.

Why It Matters: Tesla CEO Elon Musk said earlier this month that the company will start autonomous driving with its Model 3 and Model Y in Texas and California next year and the two-seater dedicated robotaxi offering called the Cybercab will join the autonomous fleet in 2026 or before 2027.

Musk, however, also admitted to being overly optimistic with timelines then, hinting at the possibility of delays in the plans.

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