Tesla has changed its robotaxi pricing model in Austin, replacing the previous flat-rate structure with a dynamic fare system based on the distance traveled. This makes short trips cheaper, while longer distances will cost more in the future.
The robotaxi service, which launched in Austin on June 22, initially charged a flat rate of $4.20 per ride – a tongue-in-cheek reference to one of Elon Musk's favorite numbers. A few weeks later, the price rose to $6.90 after Tesla expanded the service area. Since then, rides can be booked in downtown Austin, at the University of Texas, and in northern neighborhoods, among other places.
With the current version 25.7.10 of the robotaxi app, Tesla is now switching to a distance-based pricing model. This is more in line with traditional ride-hailing services like Uber or Lyft, where costs depend on distance and time. According to an overview created by X user @Tslachan, for example, a ride of less than a mile from Airbnb to Loro Bar costs $2.10. A 9-mile ride costs $12.04, while rides in the range of 5 to 8 miles cost between $7.94 and $12.60.
The longest tested ride in the robotaxi service so far covered almost the entire north-south distance of the service area: 11 miles for $13.71.
Why Tesla is opting for dynamic pricing
With the introduction of variable pricing, Tesla is aligning the robotaxi model more closely with common practice in the taxi and ride-hailing market. Shorter trips become more affordable for users, making spontaneous bookings more attractive. Longer distances remain profitable, ensuring the service is economically viable.
Since its launch, Tesla has improved the robotaxi app multiple times. Users can now change their destination after booking, and visual cues are displayed to find the optimal pickup point.
After Austin, Tesla now plans to expand the service to other regions. The current focus is on the Bay Area in California and Arizona. However, in the Bay Area, a safety driver will initially be at the wheel – unlike in Austin, where the safety companion is in the passenger seat.
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