Photo: Tesla
Tesla is in a good position to monetize a change in autonomous driving regulations, which was announced by Donald Trump's transition team. The upcoming administration wants to establish a federal framework for fully self-driving vehicles. This contrasts with current state-specific regulations that lead to fragmentation. Tesla shares jumped more than 8% in pre-market trading on the news.
Elon Musk's bet on Donald Trump appears to pay off, as he is on track to reap the benefits of his endorsement. Although the upcoming administration wants to repel the IRA EV incentives, a net positive for Tesla, the EV maker could get something way bigger in return. Bloomberg reports that Trump's transition team members have told advisers they want to fast-track a federal framework for autonomous vehicles.
The Trump administration appears to make autonomous driving a priority for the US Department of Transportation. The first step would be finding policy leaders for the department who would develop a framework to regulate self-driving vehicles. Trump's transition team also sees a bipartisan legislative measure being discussed to create federal rules around autonomous vehicles.
Bloomberg sources have named Emil Michael, a former Uber executive, as a candidate for Transportation secretary. Michael has already spoken with Trump's team, although the work is in its early stages, and policy details have yet to be determined. The report also names Republican representatives Sam Graves of Missouri and Garret Graves of Louisiana as potential candidates to lead the department.
This move would benefit Tesla and Elon Musk, who bet everything on autonomous driving and artificial intelligence. Tesla announced plans to mass-produce a driverless car, which could be called Tesla Cybercab or Robotaxi. Tesla unveiled and demonstrated Cybercab prototypes in October during the We, Robot event.
The EV maker plans to start the Cybercab production in 2026 but has yet to get a driverless testing permit in any state. Rumors indicated that Tesla partnered with the city of Palo Alto to start autonomous driving tests there. However, during the third quarter earnings call, Musk revealed he would push for federal legislation to speed up nationwide autonomous driving permitting. The market responded to the Bloomberg report, with Tesla shares climbing toward $350 in pre-market trading, up from $320.
The federal framework would significantly ease the process of getting autonomous vehicles approved. It would also make nationwide deployment much faster. Currently, every state has its own regulations regarding autonomous driving, which explains why autonomous driving companies are still confined to a few states. Getting approval in all 50 states is a tedious process, which is why Tesla preferred to stay away and market its FSD software as a Level-2 driver assistance system only.
This would not be the first effort to regulate autonomous driving at the federal level. NHTSA permits manufacturers to deploy 2,500 self-driving vehicles per year under a granted exception. Legislative efforts to increase that number to 100,000 have repeatedly failed both during Trump's first term and in the first year of Biden's administration. In the latter case, manufacturers have pushed for language that would prevent consumers from suing or forming class-action cases. This has eventually sealed the fate of the bill.
The Trump administration appears to make autonomous driving a priority for the US Department of Transportation. The first step would be finding policy leaders for the department who would develop a framework to regulate self-driving vehicles. Trump's transition team also sees a bipartisan legislative measure being discussed to create federal rules around autonomous vehicles.
Bloomberg sources have named Emil Michael, a former Uber executive, as a candidate for Transportation secretary. Michael has already spoken with Trump's team, although the work is in its early stages, and policy details have yet to be determined. The report also names Republican representatives Sam Graves of Missouri and Garret Graves of Louisiana as potential candidates to lead the department.
This move would benefit Tesla and Elon Musk, who bet everything on autonomous driving and artificial intelligence. Tesla announced plans to mass-produce a driverless car, which could be called Tesla Cybercab or Robotaxi. Tesla unveiled and demonstrated Cybercab prototypes in October during the We, Robot event.
The EV maker plans to start the Cybercab production in 2026 but has yet to get a driverless testing permit in any state. Rumors indicated that Tesla partnered with the city of Palo Alto to start autonomous driving tests there. However, during the third quarter earnings call, Musk revealed he would push for federal legislation to speed up nationwide autonomous driving permitting. The market responded to the Bloomberg report, with Tesla shares climbing toward $350 in pre-market trading, up from $320.
The federal framework would significantly ease the process of getting autonomous vehicles approved. It would also make nationwide deployment much faster. Currently, every state has its own regulations regarding autonomous driving, which explains why autonomous driving companies are still confined to a few states. Getting approval in all 50 states is a tedious process, which is why Tesla preferred to stay away and market its FSD software as a Level-2 driver assistance system only.
This would not be the first effort to regulate autonomous driving at the federal level. NHTSA permits manufacturers to deploy 2,500 self-driving vehicles per year under a granted exception. Legislative efforts to increase that number to 100,000 have repeatedly failed both during Trump's first term and in the first year of Biden's administration. In the latter case, manufacturers have pushed for language that would prevent consumers from suing or forming class-action cases. This has eventually sealed the fate of the bill.
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