Tesla shares saw a small increase early Thursday as the company works to get wider approval in Europe for its Full Self-Driving software. This could become a new source of revenue for Tesla.
The stock rose a bit in premarket trading, similar to the small gains seen in broader market futures.
This came after Reuters reported that the Netherlands is keeping secret the data it used to approve FSD in the country. This decision might make it harder for the rest of the European Union to adopt the system. Tesla did not reply to a request for comment.
The Netherlands approved FSD a few months ago. This is Tesla’s most advanced driver-assistance system and can handle most driving tasks, but still needs a person to supervise at all times. Barron’s has tested the software several times and has seen steady improvement, but Tesla’s goal of letting drivers fully disengage is still a long way off.
Now that one EU country has approved FSD, other member states can choose to follow the Netherlands’ decision. Another option is for the European Commission to submit a technical file for review by the Technical Committee on Motor Vehicles. Approval there would need support from 55% of EU countries, representing at least 65% of the EU’s population. A vote could happen as early as October.
If that does not work, Tesla could try to get approval through the United Nations Economic Commission for Europe. This group sets vehicle standards for over 50 countries and would need a two-thirds majority to approve. A vote could take place in November.
At the end of the second quarter, Tesla had 1.5 million FSD subscriptions, which is a 56% increase from last year. With a price of $99 per month, this adds up to nearly $2 billion in yearly revenue. The company said about 55% of vehicles sold in the quarter included an FSD subscription. Right now, all this revenue comes from North America, but investors hope that approval in Europe will bring more growth.
