US Safety Regulators Grant Tesla 5-Week Extension on FSD Probe
U.S. safety regulators granted Tesla a five-week extension to respond to an investigation into alleged Full Self-Driving traffic law violations. The probe focuses on whether FSD systems improperly controlled vehicles during road maneuvers, introducing potential compliance risks and liability costs that could pressure Tesla’s regulatory outlook and investor confidence.
1. Investors Trim Tesla Positions Ahead of Q4 Earnings
Tesla shares slipped into negative territory on Friday as investors booked profits ahead of the automaker’s Q4 2025 earnings release scheduled for January 28. Trading volume rose roughly 15% above its 30-day average, indicating heightened investor activity. Analysts note that delivery guidance for the quarter will be under close scrutiny, with Wall Street forecasts calling for approximately 520,000 vehicle deliveries, up 12% year-over-year. Any significant deviation could trigger further volatility in the stock.
2. Five-Week Extension Granted in U.S. FSD Probe
The National Highway Traffic Safety Administration has granted Tesla a five-week extension to respond to its investigation into potential traffic violations when Full Self-Driving (FSD) mode is engaged. Tesla now has until mid-March to submit detailed logs, software change history and safety-critical event data. Regulators are particularly focused on instances where FSD-assist features may have misinterpreted road markings or right-of-way rules. A finding of non-compliance could lead to mandatory recalls or usage restrictions.
3. Cathie Wood Highlights Robotaxi as Margin Catalyst
ARK Invest CEO Cathie Wood reiterated her bullish stance on Tesla’s autonomous mobility business, forecasting that robotaxi services could become the company’s highest-margin segment by 2028. In a recent webcast, Wood projected that a fleet of 1 million robotaxis, each generating an average of $70,000 in annual revenue, would contribute over $70 billion in recurring top-line and potentially double Tesla’s current automotive gross margins from around 25% to near 40%. She emphasized that breakthrough improvements in neural net training and in-house chip design are key drivers.
4. Energy Storage Opportunity Under Power Bottleneck
Tesla’s energy division may benefit from regional electricity supply constraints driven by AI infrastructure growth. With grid operators facing peak-demand shortfalls of up to 8 GW in certain U.S. markets, Tesla’s Megapack utility-scale batteries are being evaluated in multiple capacity auctions this quarter. An internal presentation indicates that winning two major contracts could add over 1.5 GWh of storage deployments and boost annual energy-product revenue by more than 20%, helping to diversify Tesla’s revenue base beyond vehicle sales.