Minutes after Tesla shareholders approved his unprecedented $1 trillion pay package at the annual meeting, a beaming Elon Musk took the stage at the Austin plant, greeted with cheers from investors, supporters and board members, to present his plans for the next two years. Chief among them: Cybercab, its vision of an exclusive, fully autonomous electric taxi, and Tesla’s commitment to global dominance of autonomous transportation.
Unlike its successful Model Y crossover, the Model 3 sedan or even the Cybertruck — which fell short of the billionaire CEO’s ambitious sales goals — the Cybercab will be sold exclusively as an autonomous vehicle, without conventional controls, according to Musk. Its price will be less than $30,000, making it the company’s most affordable model. And, according to Musk, it will hit the market soon.
“We have the first car designed specifically for fully autonomous driving without supervision, a robotaxi. It’s called Cybercab. It doesn’t even have pedals or a steering wheel. It also doesn’t have rear-view mirrors,” he said. “And its production is taking place right here, in this factory. We will start production in April of next year.”
It’s debatable whether Tesla is prepared to sell a vehicle truly capable of safely driving itself. In fact, the National Highway Traffic Safety Administration (NHTSA) is conducting a thorough investigation of Tesla’s fully self-driving system due to numerous accident reports. But leaving that aside, the company appears to be headed for an avoidable mistake.
At the time of this writing, such a vehicle would not comply with federal vehicle safety standards, which require specific equipment in passenger cars, such as mirrors, pedals, steering wheel, windshield, and wipers. Although work is being done on updating the regulations for autonomous vehicles, which do not use these components, their entry into force is not expected before the deadline that Musk has set for the launch of the new car.
U.S. regulations on the type of mandatory equipment that automakers must include in their vehicles are specified in the Federal Motor Vehicle Safety Standards (FMVSS) and are overseen by the National Highway Traffic Safety Administration (NHTSA). Transportation Secretary Sean Duffy proposed revising regulations for automated vehicles, but the changes will not be finalized anytime soon.
Tesla’s competitors in the robotaxis sector took this into account in their marketing plans. Amazon-owned Zoox applied for and received an exemption from NHTSA to test its purpose-built robotaxi, which lacks standard controls, on public roads. It also applied for a business exemption from FMVSS regulations so it can start charging for trips next year. That’s why, in its newly launched programs in San Francisco and Las Vegas, it still doesn’t charge for travel.
Waymo does not need such an exemption, as it uses modified versions of conventional vehicles in its robotaxi service and has no immediate plans to switch to a robotaxi model designed specifically for that purpose.
Musk does, but his company has not yet requested permission. And that is a problem.
“Tesla has not requested any exemption for the Cybercab,” NHTSA told Forbes. “Any business that intends to operate a non-compliant vehicle on public roads (except under a statutory exception, such as the FAST Act test and evaluation exception) must apply for and obtain a waiver from NHTSA before beginning operation.”
Neither Musk nor Tesla responded to requests for comment.
“As soon as the vehicle is on public roads or sold, NHTSA can do whatever it wants.”
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A week before Musk touted his plans for the Cybercab, Robyn Denholm, Tesla’s board chair, downplayed concerns about the Cybercab’s design and implementation as she campaigned for shareholders to approve Musk’s exorbitant compensation package. In addition to regulatory issues, he appeared to be addressing concerns that Tesla’s self-driving technology is not yet safe enough for the type of vehicle Musk wants to sell.
“If you have to have a steering wheel, you can have a steering wheel and pedals,” he stated in an interview with Bloomberg News on October 28. However, this completely contradicts what Musk stated on November 6. In addition, he opposes his statement from October 2024, when he assured that Tesla would not market the Cybercab as the so-called Model 2, a $25,000 electric vehicle.
“We are not manufacturing a model that is not a robotaxi,” he said. “I think we have made it very clear that the future is autonomous driving.”
‘Sean Dummy’
Under U.S. law, automakers self-certify that their vehicles meet the requirements of the Federal Motor Vehicle Safety Standards (FMVSS) and do not need prior approval from NHTSA to launch new models into production. However, a company that tries to sell a non-compliant vehicle—before changes to federal guidelines, such as those proposed for autonomous vehicles, take effect—runs a big risk, a former agency official told Forbes.
“NHTSA acts reactively due to self-certification. As soon as the vehicle is on public roads or sold, NHTSA can do whatever it wants,” said the former official, who requested anonymity. “In that case, something serious will undoubtedly happen.”
This is likely to trigger an investigation, which would force the automaker to share extensive technical data with NHTSA, according to the source. If possible defects are detected, NHTSA may order necessary repairs to be made. It can also prohibit the circulation and sale of vehicles. Additionally, the manufacturer could face fines.
If Musk hopes his former good relationship with Trump will make things easier, he could be disappointed. He certainly has not endeared himself to the Secretary of Transportation, to whom NHTSA reports. When Duffy, who also serves as NASA’s acting administrator, suggested that a moon landing contract could be awarded to Jeff Bezos’ company Blue Origin rather than Musk’s company SpaceX, the billionaire CEO, known for his lack of self-control in public statements, took to his social media platform
Also read: Waymo will expand its robotaxis service to Las Vegas, San Diego and Detroit in 2026
‘How many two-door cars are sold?’
Tesla’s electric vehicle sales peaked in 2023 at 1.8 million units, before falling 1.2% last year. A second consecutive annual decline is expected to occur in 2025, with estimated sales of 1.6 million units. BYD, a brand that Musk came to ridicule, overtook Tesla as the world’s largest seller of electric vehicles, and although Musk wants his company to focus on robotaxis and humanoid robots, cars remain his main source of income. The company urgently needs a star product after the failure of the Cybertruck.
While it might be safer to forego selling the Cybercab in the format Musk prefers, it is doubtful that this will generate substantial sales volume due to a key feature of its design: it is a two-door car.
“Two-door models are not popular, and there are many reasons for that,” said Ed Kim, president and chief analyst at consulting firm AutoPacific. Generally, it’s because American buyers find them impractical for carrying multiple passengers and cargo, he explained.
While some luxury brands still specialize in two-door sports cars, “even a legendary brand like Porsche needs to manufacture four-door vehicles in large quantities to finance the development of the two-door models that are its icons,” Kim said.
As for selling the Cybercab without a steering wheel, “I just don’t see it as possible,” said a former Tesla executive who asked not to be identified. “And with a steering wheel, it looks like a vehicle with many limitations. How many two-door cars are sold? Very few. This is the kind of thing Elon Musk is terrible at. He refuses to accept people’s way of thinking.”
This article was originally published in Forbes US
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