Tesla eyes robotaxi service launch with human backup in 2024, says Deutsche Bank

Deutsche Bank, in a note following a meeting with Tesla Head of Investor Relations Travis Axelrod, says that Tesla plans to launch its long-awaited robotaxi service next year, which will begin with a company owned fleet using human teleoperators as a safety backup.

The ride-hailing service will initially target California and Texas, and will use an in-house built ride hailing app. While Tesla has previously stated intentions to roll out its robotaxi, the confirmation of presence of teleoperator presence indicates the company taking a slow and cautious approach to safety and redundancy in the initial stages.

"The Deutsche Bank note stated that 'Tesla believes (given no real alternative at this point) this would be reasonable to assume some teleoperator would be required at the very least initially for safety and redundancy reasons.' "

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According to the bank's update, Tesla is also committed to launching its highly-awaited low-cost vehicle in the first half of 2024 followed by additional models later in the year.

It's a big step forward in Tesla’s ambitions to be in the race for autonomous driving, a rapidly evolving space which also includes rivals Waymo and Cruise. Tesla’s CEO Elon Musk has previously described the robotaxi as a cornerstone to the company’s future with a revolutionary impact on urban mobility.

The updates prompted Deutsche Bank to boost its price target for Tesla shares to USD 370 from USD 295 on optimism that the company will continue to grow. At USD 386.04, Tesla shares were slightly lower on Monday.

It comes as autonomous driving technology is under greater regulatory scrutiny following a spate of incidents involving self-driving vehicles. Including human teleoperators in the robotaxi fleet will help reduce safety concerns and build consumer trust in Tesla's autonomous systems.

As Tesla works toward commercialisation, its approach may influence broader industry strategies and regulatory frameworks for autonomous ride-hailing. The success of this rollout could play a pivotal role in shaping Tesla’s long-term position as a leader in autonomous mobility solutions.