Tesla’s self-driving mode is coming to Australia amid controversy – but it won’t create true driverless cars

Tesla is expected to soon turn on its “Full Self-Driving (Supervised)^[1]” (FSD) mode in Australia and New Zealand^[2].

Is a future of driverless cars upon us? Not exactly – it’s essentially more advanced driver assistance. Legally, Tesla drivers using this mode must be ready to take control and pay attention at all times. Calling it “full self-driving” is questionable.

The move comes amid scrutiny. This week, a video showed a Tesla navigating roads in Melbourne’s CBD without the driver’s hands on the wheel. Authorities warned these trials had not been approved^[3].

It’s a reminder of how contested “self-driving” remains. While the technology^[4] is advancing rapidly, there are still real concerns over regulations^[5], technological readiness^[6], safety^[7] and public trust^[8].

Is it legal?

Tesla’s FSD mode is not truly driverless. Technically, it’s classified as an advanced driver assistance system^[9]. On the recognised five-level list^[10] of increasingly automated cars, where 5 is fully automated, FSD is a Level 2^[11].

At this level, the driver has to remain attentive and ready to take proper control^[12]. Legally, this means Tesla’s FSD would be treated the same way as other vehicles^[13] with advanced driver-assist systems. Tesla cars with FSD running would be compliant^[14] with Australian regulations and legal to use with human oversight^[15].

At higher levels of automation (Levels 3-5), the car takes on the whole driving task without constant supervision, which would be considered “automated driving”. Level 3 cars exist in limited markets overseas^[16]. Level 4 cars are being used in fleet-based robotaxi trials^[17] but not sold to consumers. Level 5 cars offering true autonomy, anywhere, anytime don’t yet exist.

At present, cars with Level 3 automation and above are not compliant^[18] with Australian regulations and can’t operate without special permits^[19] for trials and testing. They have strict conditions on safety, insurance, data sharing and geographic restrictions.

This is why the Tesla video in Melbourne video triggered pushback – it gave the impression of a higher level of automation than legally permitted without a trial permit.

What can FSD actually do?

Tesla is taking a phased approach^[20] to enable FSD for eligible vehicles in Australia.

In this mode, the car can change lanes, navigate interchanges, recognise stop signs and automatically bring the car to a stop. It can even handle Melbourne’s famous hook turns^[21].

But the system has hard limits^[22]. The driver must be ready to step in at any moment. The system can make errors in complex or unpredictable^[23] settings.

Overseas, Tesla is promoting a new supervised feature – autosteer on city streets – which would go beyond automated highway driving into more complex residential and city roads with roundabouts, traffic lights and pedestrians. But this feature remains “upcoming^[24]” in Australia.

Tesla’s approach to self-driving remains controversial^[25]. To sense their surroundings, the vehicles rely mainly on cameras and artificial intelligence. Critics argue^[26] this leaves the system more vulnerable^[27] to errors. Other self-driving car developers such as Waymo have added LiDAR and radar sensors^[28] to boost safety in case other sensors fail.

Tesla’s branding of FSD as a step towards full autonomy is misleading^[29]. In reality, it’s closer to a diligent learner driver^[30] than a professional chauffeur. It can read the road, but still needs close supervision.

The long road to autonomy

Tesla’s push into autonomy is partly about capturing market share^[31] in the fast-emerging robotaxi industry^[32].

Tesla CEO Elon Musk has promised Tesla cars will one day be able to be monetised in a shared robotaxi fleet^[33].

In June, the first Tesla Robotaxi went live^[34] in limited areas^[35] of Austin, Texas. But these vehicles are not truly driverless – a human safety monitor^[36] must be on board.

Globally, Tesla is one of many companies vying for a share of the robotaxi market. Trials are expanding quickly^[37]. Waymo is leading the race^[38] with paid driverless rides in several cities in the United States. Its Jaguar cars are Level 4 autonomous, able to drive unsupervised but only in a set area.

Meanwhile, Baidu^[39], WeRide^[40] and Pony.ai^[41] are scaling up in China^[42], their domestic market, as well as the Gulf region^[43], including Dubai^[44], Abu Dhabi^[45] and Riyadh^[46].