Can Tesla survive the lawsuits coming for its robotaxi fleet

Tesla’s ambition to launch a fully autonomous ride-hailing service may soon face its biggest legal liability roadblock yet.

Sixteen days into a quiet robotaxi pilot program in Austin, Texas, a Tesla Model Y test vehicle reportedly struck a parked Toyota Camry outside a pizza shop on June 24. While no one was injured, the incident has ignited a growing debate on what happens when a self-driving Tesla crashes, especially with no human behind the wheel?

Until now, Tesla has largely avoided major legal consequences from fatal accidents involving its Autopilot and Full Self-Driving (FSD) features, as drivers were still technically required to remain alert. But robotaxis change everything. When a fully autonomous vehicle crashes, it’s the machine—not the human—that’s in control.

A new kind of risk for Tesla and its customers

Elon Musk has long pitched the robotaxi dream as a way for Tesla owners to earn passive income, like renting out homes on Airbnb. At Tesla’s 2023 shareholder meeting, Musk said customers would be able to “add or subtract” their cars from the robotaxi fleet with a simple app tap.

However, experts warn that owners joining Tesla’s ride-hailing network may be opening themselves up to lawsuits if their vehicles are involved in accidents. Mike Nelson, a veteran attorney in over a thousand Tesla-related cases, says owners could be sued for negligence. “Plaintiff’s attorneys might argue the car was poorly maintained or misrepresented in condition,” he said. Even more worrying, Nelson added, “If a Tesla robotaxi crashes at 3 a.m., does the owner have to go to the scene to speak to police?”

Unanswered questions on insurance, maintenance, and liability

Tesla has not explained how it will manage service, cleaning, and quality control for cars it doesn’t own. Unlike Waymo, which closely monitors its 2,000-vehicle fleet with regular maintenance stops, Tesla may rely heavily on individual owners, raising serious concerns about safety and consistency.

Insurers are also uneasy. “Combining self-driving tech with the gig economy is a novel and complex risk,” says Ben Lewis of Simulytic, a firm helping insurers assess autonomous vehicle data. He predicts limited appetite for such policies in the near term.

Meanwhile, Tesla’s technology, relying solely on cameras rather than lidar and radar, may become a legal vulnerability. Lawyers could argue Tesla “cut corners on safety,” especially when compared to Waymo’s expensive but comprehensive sensor suite.

Read more on Tesla moves to keep Robotaxi safety details secret as federal investigation deepens