(Reuters) -Tesla is set to begin a test of its long-promised robotaxi service on schedule in Austin, Texas, by the end of June, Chief Executive Elon Musk said on Tuesday, even as the company faces questions from a U.S. regulator on safety.
The electric vehicle maker will roll out about 10 self-driving cars in some parts of the city, Musk said in an interview with CNBC, adding that robotaxi deployment would scale up to about a thousand within a few months.
“We are actually going to deploy not to the entire Austin region, but only the parts that are the safest. So, we will geofence it,” Musk said.
Shares were up less than 1% in afternoon trading.
A successful trial will be crucial for Tesla as Musk has pivoted the company’s focus away from building a new cheaper EV platform amid weakening demand to launching the robotaxi service and its Optimus humanoid robots. Much of the company’s valuation hangs on that bet.
“The only things that matter in the long term are autonomy and Optimus,” Musk told CNBC.
But autonomous vehicle technology has been hard to commercialize, with tight regulations and heavy investments forcing many companies to shut shop. The companies still in the race, including Alphabet’s Waymo, have faced increased scrutiny.
The National Highway Traffic Safety Administration has been investigating collisions involving Tesla’s full self-driving (FSD) advanced driver assistance software in reduced roadway visibility conditions since October. The U.S. road safety regulator asked Tesla last week to answer questions on its paid robotaxi service launch to assess how the cars will perform in poor weather.
Tesla is in talks with major automakers to license the FSD software that is expected to underpin its robotaxis, Musk said.
(Reporting by Akash Sriram in Bengaluru and Abhirup Roy in San Francisco; editing by Peter Henderson and Deepa Babington)
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