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Tesla CEO Elon Musk is in what one might describe a suboptimal position. He’s pushed hard to get shareholders to view Tesla as an AI and robotics company, not a maker of EVs. And yet, the company’s most visible products, which generate the bulk of its revenues, are its electric cars. 

Yes, Tesla EVs are advanced, particularly when it comes to its underlying vehicle architecture and software. And its driver-assistance system known as Full Self-Driving Supervised, which can be used on highways and city streets and requires hands on the wheel and the driver to be ready to take over, is considered among the most capable on the market today. But to Musk, the ultimate illustration of an AI and robotics company is self-driving cars and humanoid robots. And today, neither of them exist at any scale. 

Tesla’s first notable step toward that goal was in June when it launched a limited robotaxi service in Austin, Texas. Those Robotaxi-branded vehicles, which invited customers can hail via an app, have a Tesla employee sitting in the front passenger seat. But it’s still far from Musk’s original vision of a “general solution” that would allow a Tesla owner to earn money by renting out their vehicle as a robotaxi service. 

The clock is ticking and Musk needs to show more progress — or at the very least tease upcoming launches to keep antsy shareholders content. Which is perhaps why Tesla is embarking on this ride-hailing gambit in California.

Earlier this month, Musk noted that Tesla would be launching a robotaxi service in the Bay Area “in a month or two” — regulatory approvals being the primary hang-up.

The problem? Tesla hasn’t even applied for the permits that would allow it to operate a robotaxi service. I checked Friday morning with the California DMV, which regulates driverless testing, and Tesla has not yet applied for the necessary permits. (A spokesperson did tell me the DMV met with Tesla to discuss the company’s plans to test autonomous vehicles in the state.)

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So, instead Tesla has launched a ride-hailing service in the Bay Area. And yeah, users keep calling these robotaxis. 

To be clear, while folks — including Musk’s brother and Tesla board member Kimbal Musk — may refer to these as robotaxis, they are not driving autonomously. (And if they are, it would be a violation of current regulations.) Again, Tesla does not currently have the permits to do anything beyond pay its own employees to use its fleet of EVs to drive people around the Bay Area. No autonomous driving in any way, shape, or form. You can read a recent explainer here that will take you through all of the various permits Tesla needs.

This ride-hailing launch has many folks wondering, what gives? My answer: optics.

A little bird

Image Credits:Bryce Durbin

Recent chatter among some little birds suggests that the National Automobile Dealers Association is focusing its efforts on VW Group spinout Scout and the EV company’s plans for direct sales. The dealership industry group has opposed the direct sales model before. But unlike direct-sales adopters Tesla, Rivian, and Lucid, Scout is attached to a legacy automaker with a long-established dealer network.

Got a tip for us? Email Kirsten Korosec at kirsten.korosec@techcrunch.com or my Signal at kkorosec.07, Sean O’Kane at sean.okane@techcrunch.com or Rebecca Bellan at rebecca.bellan@techcrunch.com. 

Deals!

Image Credits:Bryce Durbin

Think back to the fall of 2023. Logistics company Flexport had captured the attention of Silicon Valley, in part because of founder Ryan Petersen’s fallout with ousted CEO Dave Clark and because of its acquisition of Convoy, the former freight tech unicorn that had just shut down. 

Here’s an update. Flexport has now sold the Convoy platform to DAT Freight & Analytics. The terms were undisclosed, although the company said it had delivered a “massive return on investment for Flexport.” Reporting from Axios’ Dan Primack suggests that, yes, indeed “massive return” is an appropriate description. 

Flexport never disclosed exactly what it had paid for Convoy’s tech, although reporting at the time put the figure at $16 million — a fraction of the unicorn’s previous valuation of $3.8 billion. Primack reported this week that Flexport sold the Convoy platform for $250 million. 

Other deals that got my attention this week …

AIR, an Israel-based startup developing eVTOLs, raised $23 million in a Series A funding round led by Entrée Capital, with participation from existing backer Dr. Shmuel Harlap, an early investor in Mobileye. 

LG Innotek, the components and materials subsidiary of South Korea’s LG Group, is investing up to $50 million in Aeva, acquiring an equity stake of about 6% in the U.S. lidar company. The investment is part of a broader manufacturing partnership between the two companies and marks Aeva’s push into consumer electronics, robotics, and industrial automation. 

Notable reads and other tidbits

Image Credits:Bryce Durbin

Aurora shared some notable progress in its Q2 earnings report. The autonomous vehicle tech company has three self-driving trucks operating commercially between Dallas and Houston, logging more than 20,000 driverless miles by the end of June. It is piloting driverless trucks on a 15-hour route from its terminal in Fort Worth, Texas, to a new terminal in Phoenix and is operating at night. CEO Chris Urmson told me what is next on his list.

Elon Musk’s tunnel-digging company The Boring Company plans to build a 10-mile “loop” that will connect Nashville’s downtown and its convention center and airport. Important side notes: This will be funded by The Boring Company and its private partners, which are not named. And this is the start of a public process to evaluate routes, which means work won’t be starting right away.

Ford plans to reveal more information about its upcoming low-cost electric vehicles at an event in Kentucky on August 11. And, as senior reporter Sean O’Kane notes, the company is talking a very big game.

Joby Aviation has signed an agreement with defense contractor L3Harris Technologies to “explore opportunities” to develop a new aircraft class — specifically, a gas-turbine hybrid vertical take-off and landing (VTOL) aircraft that can fly autonomously — for defense applications. The gas-turbine hybrid VTOL will be based on Joby’s current S4 aircraft platform. This isn’t a contract, per se. But it does mark progress in Joby’s bid to go to market in the defense and consumer sectors.

While Uber continues to partner with every autonomous vehicle company under the sun, Lyft is trying to make its own deals. Lyft said it will add autonomous shuttles made by Austrian manufacturer Benteler Group to its network in late 2026. The shuttles will be deployed in partnership with U.S. cities and airports.

Waymo plans to launch a robotaxi service next year in Dallas, and this time it is partnering with Avis Budget Group to manage its fleet of autonomous vehicles. In other Waymo happenings, two of its robotaxis crashed into each other at one of the company’s staging lots in Phoenix this week, proving that the company’s rapid expansion into new cities does not mean it has ironed out all the kinks. Waymo says it’s investigating the cause.

Chinese AV company WeRide received an autonomous driving permit from Saudi Arabia. The company holds similar permits in China, the UAE, Singapore, France, and the United States.

One last thing

Image Credits:Slava Blazer Photography

Waymo co-CEO Tekedra Mawakana will join the Disrupt Stage for a wide-ranging conversation on the current state of AVs — and where the industry goes from here. TechCrunch Disrupt 2025 will be held October 27–29 at Moscone West in San Francisco.