/ February 27, 2026 The narrative surrounding Tesla’s self-driving technology is encountering significant pressure in California. Recent disclosures from the state’s Department of Motor Vehicles (DMV) and an ongoing legal battle are challenging the very story that has long been pitched to investors as the company’s primary growth engine. This raises a critical question: how close is a viable robotaxi service when regulatory bodies are simultaneously raising the bar for approval? Regulatory Friction in California According to documents released by the California DMV, Tesla reported zero miles of autonomous testing on public roads within the state for the year 2025. This disclosure is particularly striking as the company continues to promote its progress toward a fully autonomous fleet. Compounding this issue is an active lawsuit Tesla has filed against the same regulatory body. The legal action stems from a DMV determination that the marketing terms “Autopilot” and “Full Self-Driving” are potentially misleading. In response to regulatory scrutiny, Tesla has already adjusted its advertising language; references to “Autopilot” have been removed in some materials, and “Full Self-Driving” is now described as a supervised system. A further obstacle is Tesla’s current lack of permits for completely driverless operations in California. Present regulatory text indicates the company only holds an entry-level permit, which mandates the presence of a human safety driver behind the wheel. Proposed rules for the next phase of testing would require at least 50,000 miles of supervised autonomous driving—a benchmark that appears difficult to achieve without a substantial increase in documented testing activity. Texas Relocation and Grid Pressures While regulatory challenges mount in California, strategic developments are unfolding in Texas. Following shareholder approval in June 2024 to move its legal corporate headquarters to the state, Tesla now operates in a region where the electrical grid is under immense strain.