Tesla has secured a Transportation Network Company permit from Arizona regulators, allowing the company to launch a paid autonomous ride-hailing service in the state. The approval, granted on November 17, 2025, follows an application submitted on November 13 and marks the final regulatory step for commercial operations. Arizona's supportive environment for autonomous vehicles positions it as a key expansion area for Tesla.
Tesla applied for the Transportation Network Company (TNC) permit with the Arizona Department of Transportation on November 13, 2025, and received approval on November 17, according to a spokesperson from the department. "Tesla has met the requirements to operate as a TNC and is permitted as of Nov. 17," the spokesperson wrote in an email to Business Insider. This permit enables Tesla to charge for rides, distinguishing it from testing certifications that do not allow commercial services.
The approval completes Tesla's regulatory process in Arizona, where the company first contacted the department in June 2025 expressing interest in operating within the Phoenix Metro area. Tesla completed the state's self-certification process for autonomous vehicle testing in September 2025, covering operations with and without drivers. Arizona requires companies to submit a Law Enforcement Interaction Plan and acknowledge compliance with federal law, but its regulations are less stringent than those in states like California, where safety monitors must sit behind the wheel in the Bay Area.
Arizona has emerged as a hub for autonomous vehicle development, with Waymo operating commercial robotaxis in the Phoenix area since 2018 across 315 square miles. Tesla's entry intensifies competition, leveraging its Full Self-Driving Supervised system trained on billions of miles of data. Currently, Tesla runs a limited robotaxi service in South Austin with human safety operators in the passenger seat and a pseudo-ride-hailing service in California using employee drivers under a charter permit.
Elon Musk stated in October 2025 that Tesla plans to launch the service in eight to 10 cities by the end of the year, with more than 1,000 vehicles. On November 18, Tesla expanded access to its robotaxi app for all iOS users in the US and Canada. Users have reported volatile wait times due to high demand, with the app sometimes indicating delays of up to 12 minutes. A Tesla spokesperson did not respond to requests for comment.
The permit is not limited to a specific city, allowing statewide operations on public roads.
