Tesla Could Benefit as US Considers Removing Steering Wheel Rules

What happened

NHTSA Administrator Jonathan Morrison stated the agency will 'absolutely' consider removing the requirement for steering wheels in driverless cars, arguing that manual controls are unnecessary for vehicles never intended for human operation. This follows NHTSA's recent move to update federal safety standards by removing the mandate for manual brake pedals in autonomous vehicles. The changes are part of the Trump administration's broader effort to modernize regulations for self-driving cars. Morrison clarified that the brake pedal change would apply only to vehicles designed to operate exclusively without a human driver, while existing rules remain unchanged for all other vehicle types. No specific timeline was provided for the steering wheel rule reevaluation.

Why it matters

These potential regulatory changes could significantly benefit Tesla's robotaxi ambitions. The company has been producing its Cybercab, a two-seat electric vehicle that lacks both a steering wheel and foot pedals, but has not yet deployed it broadly. Removing steering wheel requirements would eliminate a major regulatory barrier to bringing such purpose-built autonomous vehicles to market. Tesla CEO Elon Musk has actively advocated for policy changes supporting broad commercial deployment of self-driving vehicles, including calling for a federal framework for driverless cars. The regulatory shift could accelerate Tesla's timeline for standing up its robotaxi business, which represents a key growth opportunity beyond traditional vehicle sales.

Bigger picture

The regulatory modernization effort extends beyond Tesla to the broader autonomous vehicle industry. The robotaxi market includes major players like Amazon's Zoox and Alphabet's Waymo, the leading operator of paid robotaxi rides in the US. All these companies are developing or deploying purpose-built autonomous vehicles that could benefit from relaxed design requirements. The Trump administration's push to update decades-old vehicle safety standards reflects the growing maturity of autonomous driving technology and the need for regulations that accommodate fundamentally different vehicle architectures. However, the changes remain narrowly focused on vehicles designed exclusively for autonomous operation, maintaining existing safety requirements for conventional cars and those with optional self-driving features.

What to watch

Watch for NHTSA to announce a formal timeline and process for reviewing steering wheel requirements. Tesla's progress in deploying Cybercabs commercially will indicate whether the company can capitalize on these regulatory changes. Monitor whether competitors like Waymo and Zoox accelerate their own purpose-built vehicle programs in response. Any public comment periods or industry feedback on the proposed rule changes will reveal potential safety concerns or opposition. Finally, track whether other federal or state regulations remain as obstacles to widespread robotaxi deployment, as vehicle design requirements are just one part of the regulatory framework.