Pressure from Tesla Cybercab to expand after difficult first month in Austin

In the month since that of Tesla With Cybercab’s deployment in Austin, the company has nearly quadrupled the number of its driverless bronze two-seaters authorized for commercial service in Texas. For Elon Musk to achieve his ambitions, growth must accelerate

These unusual driverless vehicles, with no steering wheel, pedals, mirrors or exterior door handles, received mixed reviews from paying passengers, who shared videos and posts online after the September 3 launch. Criticisms have included long wait times, pickups and drop-offs at the wrong location, and technical difficulties with gullwing doors or vehicles’ trunks closing improperly.

Improving its driverless technology and rapidly growing the Robotaxi service are key to Tesla’s efforts to reignite investor enthusiasm. Auto sales have been slow for a prolonged period and stocks have been losers on Wall Street this year, down 18%, the only mega-cap tech stock that has failed to generate positive returns for investors.

On Friday, Tesla reported better-than-expected vehicle deliveries for the third quarter, lifting the stock nearly 5%, but the company still posted a 2% year-over-year decline in deliveries. Tesla’s core auto business has seen consecutive annual revenue declines as it faces pressure from Chinese electric vehicle makers like BYD and Xiaomi, which are selling more affordable, innovative models while increasing exports to Tesla’s key markets. particularly in Europe and Asia.

In the meantime, The alphabet Waymo continues to open in new cities. It is now in 15 U.S. markets, with 15 more on the horizon, according to the company’s website. It also announced international launches planned for London, Tokyo and Munich.

In Texas, Waymo had 1,154 autonomous vehicles approved for commercial use as of Friday, including 359 of its new Ojai models, which feature a low step and doors that slide open and close. Waymo takes more than 500,000 paid trips each week and has logged 270 million miles of fully autonomous commercial driving nationally. It currently has more than 4,000 driverless vehicles in commercial operation in the United States.

Tesla had 45 Cybercabs licensed for commercial use in Texas at the time of its unveiling in Austin, a number that stood at 169 as of Friday, according to public records from the Texas Department of Motor Vehicles.

Austin, Tesla’s hometown, is the only city where the Cybercab currently operates as part of its driverless ride-hailing service. The company’s Robotaxi fleet in Texas also includes 420 Model Y vehicles equipped with Tesla automated driving systems, which are not yet available to individual car buyers.

Austin became one of the first popular markets for robotaxis due to a combination of relatively lax state regulations and the capital’s vibrant tech community. from Amazon Zoox is also testing in Austin.

Expanding beyond Austin is the next challenge for Tesla Cybercab.

Besides technical issues, the company faces some potential regulatory hurdles to expansion. The National Highway Traffic Safety Administration (NHTSA) issued a so-called audit request after Cybercab’s launch to ensure vehicles comply with federal safety standards.

NHTSA had initially ordered Tesla to respond by September 30 to a long list of safety questions, but the company was granted an extension, an agency spokesperson told CNBC by email.

Ethan McKanna, an Austin resident and former Tesla intern, told CNBC that he has ridden in every type of autonomous vehicle available to the city’s public riders.

McKanna, 20, now a sophomore computer science major at Texas A&M University, also created a site called RobotaxiTracker.com, which uses machine learning to analyze data from traffic cameras and other public records to show how autonomous services work in American cities.

McKanna said he’s taken about 30 Cybercab rides and has been taking Waymo rides since they debuted in Austin in 2024. With the Cybercab, McKanna said he liked having his “own space with access to a giant screen, media controls and apps,” and he found the ride quality “very smooth.”

“The pick-up and drop-off experience,” he said, was not yet refined and gullwing doors that extend outward are “less convenient” than more traditional doors or doors that slide open. You also need patience, he says.

“There was so much demand that wait times often reached more than 45 minutes,” he said, referring to the period when the Cybercab was first deployed. This has resulted in “more equalized demand” in recent weeks, he said.

“Waymo has been in business operations longer, so they’re just more mature with 24/7 service, better support, things like that,” McKanna said, adding that in Waymo’s early days in Austin, there were problems with “hard braking.”

No significant safety incidents or collisions have been reported in Austin involving a Cybercab since commercial debut. But first responders have expressed concerns about the Cybercab’s lack of manual driving controls and its unique doors.

Austin Fire Capt. Matt McElearney told CNBC in an interview that while Tesla has provided detailed emergency guidelines and given first responders comprehensive instructions on how to handle Cybercab and Model Y Robotaxi vehicles in various events, it doesn’t go far enough.

McElearney said he would like to see national or state regulation of autonomous vehicles requiring robotaxis without steering wheels or pedals to provide another way for “public safety officials to take control – move, direct or stop an AV – in emergent or non-emergent events.”

And because their performance can change due to bugs or software updates, antiviruses should “pass testing throughout the life of the product,” through a sort of “dynamic certification” process, McElearney added.

Tesla did not immediately respond to a request for comment.

The public also has a wide range of safety concerns.

According to surveys conducted by Slingshot Strategies in a September 2026 report on electric vehicles, 50% of respondents in the United States said they would not feel comfortable riding in a robotaxi without a steering wheel or pedals. After hearing about the NHTSA investigation into Tesla’s Cybercab, 70% of respondents wanted the company to suspend its rides, according to the surveys.

Musk needs this sentiment to change if he is to successfully bring Tesla into the driverless era. Its next step in trying to become a major player in the market will be an expansion into Texas, San Antonio, Dallas and other cities, as well as Nevada and Florida, where AV companies can take advantage of warm weather and favorable state regulations.

In January, Musk said at the World Economic Forum in Davos that the company’s robotaxis would be “very, very widespread” in the United States by the end of 2026. That hasn’t happened yet. And in California, where Waymos are commonplace in several cities, Tesla has still not obtained authorization to operate its vehicles on public roads without a human being behind the wheel.

After Tesla’s deliveries report on Friday, Cantor analysts highlighted the scale of the opportunity.

“Management has previously stated that once production is ramped up, it expects the Cybercab to ultimately become the largest vehicle in its lineup,” they wrote.

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