Tesla transitions from a traditional EV manufacturer to a tech-driven company spearheading autonomous robotaxis and humanoid robots, amid market share challenges and regulatory hurdles.
Elon Musk’s Tesla Inc. is currently shifting gears—big time—moving away from its traditional role as a top electric vehicle (EV) maker toward becoming more of a tech company with a focus on autonomous systems and robotics. This change was pretty clear when Musk recently introduced the Cybercab robotaxi, a driverless car that has no pedals or steering wheel, set to start production no earlier than 2026. Priced under $30,000 and equipped with Tesla’s Full Self-Driving (FSD) tech, the Cybercab really highlights Tesla’s goal to revolutionize city transit using AI and automation. Alongside this new vehicle, Tesla also revealed other autonomous innovations, like the Robovan minibus that drives itself and the Optimus humanoid robots, signaling a broader product range that’s now venturing well beyond just traditional cars.
Now, even though Tesla has built quite a reputation for clever innovations in EVs, the company isn’t without its challenges. In fact, by August 2025, Tesla’s slice of the U.S. EV market dipped below 40%—the lowest it’s been since 2017. Back when it was at its peak, Tesla held around 80% of the market share. But these days, it faces tough competition from giants like General Motors, Ford, Hyundai, and an influx of Chinese carmakers rolling out more attractive, updated EV models. Industry pros suggest that part of Tesla’s slide might be due to its lineup starting to look a little dated. Plus, Musk seems to be putting a bigger emphasis on AI projects—like robotaxis and humanoid robots—rather than just selling cars. The company is projecting record EV sales for the upcoming quarter; still, most of its growth in the future is expected to come from autonomous vehicles and robotics, not just traditional vehicle sales.
Tesla’s “Master Plan,” most recently laid out through Musk’s social media and official statements, aims for what they call “sustainable abundance." Basically, that means integrating clean energy, AI, and automation into a single ecosystem. The plan envisions robotaxis and humanoid robots, like the Optimus models, creating new revenue streams and transforming Tesla’s entire business model. Observers in the industry are noting that Musk has said that as much as 80% of Tesla’s future value could come from Optimus humanoid robots, while a separate investor view suggests the robotaxi segment could comprise up to 90% of Tesla’s enterprise value by 2029. Some investment firms even predict that by the end of this decade, the robotaxi segment alone might make up around 90% of Tesla’s valuation. However, it’s worth pointing out that currently, about 75% of Tesla’s revenue still comes from the sales of Model 3s and Model Y—so, in a way, the company is still midway through a major transition.
Entering the autonomous vehicle space puts Tesla head-to-head with established players like Waymo, backed by Google’s parent company Alphabet, and GM’s Cruise. Both of these firms are already operating fleets with safety drivers and have received regulatory approval. Tesla, on the other hand, is aiming for a pretty daring approach—launching fully driverless robotaxis that don’t require human drivers, which raises significant questions about regulation, technology, and safety. Recent news suggests that regulators in places like California have made Tesla dial back its plans, forcing the company to suggest a more limited rollout than Musk has publicly talked about. Some shareholders have responded with lawsuits, accusing Tesla of overhyping its self-driving capabilities and downplaying the risks of autonomous systems.
In addition to the robotaxi effort, Tesla’s push into humanoid robots with the Optimus project is another bold step. Unlike software bots, these robots need to move around in real-world environments, which are unpredictable and complex. That’s a big challenge, especially because most current industry practice involves keeping such robots within constrained environments like factories for safety reasons. Smaller companies working on delivery robots and smart infrastructure solutions show how tricky and slow the broader adoption of AI in the real world still is. Tesla admits that cautious, geofenced testing will be necessary as it continues to develop both the robotaxi and humanoid robot technologies.
The launch of Tesla’s autonomous systems has also coincided with more scrutiny over Musk’s leadership and the company’s governance practices. Recently, Tesla’s board recommended a staggering $1 trillion compensation package for Musk, which has sparked some criticism, with concerns about the risks tied to a single individual’s vision dominating the company’s future. Furthermore, Tesla’s close association with conservative political figures—former President Donald Trump included—has ignited debates about how its brand appeals across different voter groups, especially among Democrats.
Looking ahead, whether Tesla manages to successfully become a leader in autonomous ecosystems will hinge on its ability to navigate regulatory hurdles, improve the dependability of its tech, and roll out products that meet safety standards. Industry insiders say that Musk’s visionary Master Plan offers huge potential upside, but that the road to making fully autonomous robotaxis and humanoid robots mainstream is still full of technical hurdles, safety concerns, and compliance issues. Milestones like removing safety drivers in test cities such as Austin and expanding deployment more broadly will be crucial tests of Tesla’s ambitions. If the company manages to overcome these challenges, it could usher in a new era of transportation and robotics. But if not, there’s a real risk that stakeholder confidence could erode in this highly competitive and rapidly changing market landscape.
Source: Noah Wire Services
