Tesla’s AI Gamble: Can FSD Approvals and Robotaxi Progress Salvage a Slipping EV Empire?

Elon Musk bets Tesla’s future on AI-driven autonomy as regulatory delays and market share losses threaten his $1.8 trillion valuation.

Elon Musk said in Davos: “We hope to get Supervised Full Self-Driving approval in Europe, hopefully next month, and then maybe a similar timing for China.” The Dutch vehicle authority RDW expects to decide on FSD approval in February 2025, with EU-wide rollout contingent on the Netherlands’ exemption status.

Meanwhile, Tesla’s Austin robotaxi service now operates without safety monitors, following a June trial with employee oversight.

Yet the company faces mounting headwinds. Tesla’s U.S. market share in California fell below 50% in 2024, with vehicle registrations dropping 11.4%. The company lost its position as the world’s largest EV maker to BYD in 2025, reporting a second consecutive drop in vehicle deliveries.

Musk also delayed public humanoid robot sales to “end of next year,” citing technical challenges in scaling AI training data and manufacturing.

“The market is demanding credible evidence of progress,” said Tesla’s Chief Financial Officer Zachary Kirkhorn in a recent investor call. “Every delay in regulatory approvals or product launches impacts our ability to scale.”