Musk's Europe gamble: Will others follow the Dutch and approve FSD?

Following last year’s Tesla shareholder vote, CEO Elon Musk’s near-incomprehensible wealth is now inextricably linked in part to the number of active “FSD” subscriptions his electric car company can sign up. And last month, the Dutch vehicle regulator RDW made that a little easier by approving FSD for use on its roads. Now, the RDW will ask the rest of the European Union to follow suit, opening up a new market of 450 million potential new customers for the driver assist. But it’s no foregone conclusion: Tesla faces plenty of skepticism from other European regulators, according to a report published today by Reuters.

Among the goals Musk must meet if he wants all 423.7 million shares in his new contract—current market value $1.7 trillion: Over the next decade Tesla needs at least 10 million subs on the hook. Those kinds of numbers are unachievable if he has to rely just on North American users; Tesla needs Europe and China to say yes, too.

But neither China nor the EU has quite the same attitude toward consumer safety that we do in the US, where our government has decided to implicitly trust companies like Tesla at their word when they say a new product is safe. Instead, Chinese and European regulators require premarket approval before letting something loose on their roads.

FSD or sparkling driver-assist?

Indeed, the differences between what Tesla is calling FSD in Europe and what it calls FSD in the US go beyond the $99/month versus 99 euro/month price tags. The Dutch-approved build of FSD drives more conservatively, monitors its human driver more frequently, and requires they be ready to put their hands on the wheel at a moment’s notice; American FSD lets drivers take their hands off the wheel on the highway and does not (yet?) comply with UN R-171 regulations. Some other features are absent as of now—there’s no summon, and it’s not meant for use on most urban roads.

RDW’s approval took 18 months and was based on more than a million miles (1.6 million km) driven on EU roads, 13,000 customer ride-alongs, and several filing cabinets full of documents. And, based on its judgment, it says the system is safe if used properly. Today, RDW will present its findings to other European regulators. At some point, probably later this summer, the Technical Committee on Motor Vehicles will vote whether or not to adopt RDW’s approval across the rest of the EU; Tesla needs 15 of the 27 member states to say yes to make that happen.

Based on emails seen by Reuters, some of those other regulators are skeptical. A Swedish official was “quite surprised” to learn the system had been programmed to break speed limits, something he would not condone. He also questioned if the name FSD “risks giving consumers a misleading ⁠impression,” something that critics have long maintained results from Tesla’s naming practices.

Winter performance was another concern: “Are they really introducing a system that allows hands-free driving also on icy 80 km/h roads?” asked a Finnish official, who also raised the issue of large-animal collisions—think Sweden’s famous moose test.

Emails also show Tesla’s aggressive lobbying of Swedish regulators to copy the Dutch just days after RDW announced its approval and before the Swedes had reviewed any of the relevant documents.

The next meetings of the Technical Committee—when it could hold a possible vote—are in July and October.