Autonomous vehicle technology is advancing toward Level 4 and 5 driverless territory, with companies seeking exemptions from federal motor vehicle rules. But a federal investigation into Tesla’s Full Self-Driving (FSD) feature raises concerns about existing Level 2 autonomous technology.

Tech companies are promising that driverless vehicles will make the roadways safer. A lot of people are not convinced the industry is quite there yet.

Last year, AAA published a survey revealing that more than 60% of Americans are afraid of self-driving vehicles. Meanwhile, trucking stakeholders are pushing back on driverless truck company Aurora’s request to be exempt from rules about warning devices.

Vehicles with no human behind the wheel are Level 4 and 5 automation technology. With the exception of Mercedes’ Level 3 Drive Pilot, the highest level of automation currently available to consumers is Level 2. Mercedes’ Drive Pilot is authorized only on certain roadways in California and Nevada.

Among the most popular Level 2 technologies is Tesla’s FSD mode. That feature has been the center of controversy. In 2020, the Owner-Operator Independent Drivers Association sent a letter to the National Highway Traffic Safety Administration expressing concerns over the feature.

Two years later, California passed a law that effectively bans Tesla from marketing its vehicles as fully self-driving. In April 2024, a group of senators urged NHTSA to start regulating autonomous vehicles, citing numerous high-profile crashes involving Tesla’s FSD feature.

Six months after the senators reached out to NHTSA, the agency launched an investigation into Tesla’s FSD feature. The investigation is looking into the feature’s ability to respond to reduced roadway visibility conditions, including sun glare, fog and airborne dust.

Four reports of crashes involving the FSD feature prompted the investigation.

Details of the investigation have been limited. Of the 55 documents on NHTSA’s investigation page, nearly all are either completely redacted or contain Tesla’s redaction requests. In April 2025, while the investigation was ongoing, Tesla doubled down on the feature by announcing it will be using the system for driverless robotaxis.

FSD Supervised ride-hailing service is live for an early set of employees in Austin & San Francisco Bay Area.

We’ve completed over 1.5k trips & 15k miles of driving.

This service helps us develop & validate FSD networks, the mobile app, vehicle allocation, mission control &… pic.twitter.com/pYVfhi935W

— Tesla AI (@Tesla_AI) April 23, 2025

Within the first month of Donald Trump’s return to the White House, NHTSA announced it was laying off 4% of its employees at the direction of the Department of Government Efficiency. That agency was the brainchild of Elon Musk, the CEO and co-founder of Tesla, who was the de facto leader until the end of May 2025.

Concerns grew over Musk’s involvement with the federal government. NHTSA noted that layoffs will not affect its investigations into Tesla. Last March, seven families of people killed in crashes involving Tesla’s autonomous features, including FSD, sent a letter to Transportation Secretary Sean Duffy, urging him to fully investigate the manufacturer’s features. Apparently, Duffy listened.

NHTSA has recently upgraded its Tesla FSD investigation from a preliminary evaluation to an engineering analysis, indicating a problem may exist.

For the past year and a half, NHTSA has been conducting a preliminary evaluation. Those are prompted by complaints, crash reports or other data signals. Preliminary evaluations simply look into whether there is a potential safety defect. When a preliminary evaluation is escalated to an engineering analysis, that means NHTSA has found enough information to suggest the safety issue may be real and significant.

According to investigation documents, NHTSA has been looking at nine separate crashes. Tesla has told the agency that an FSD software update would have affected about a third of those crashes. Regardless, NHTSA is not convinced that updates would have cured any potential defects.

Investigation documents show that NHTSA has found that Tesla’s FSD did not detect reduced visibility conditions and failed to alert drivers until just before impact. In several cases, the feature lost track of a lead vehicle or never detected it at all.

Regarding system upgrades, NHTSA says failures occurred both before and after software updates. FSD has not given drivers enough time to take over.

While NHTSA has identified nine crashes, Tesla has acknowledged that data limitations may have led to underreporting of crashes. A NHTSA standing general order requires autonomous vehicle manufacturers to report certain crashes.

An engineering analysis can end several ways. NHTSA may find no defect and close the investigation. If a defect is found, the agency could force a recall or require Tesla to take certain actions. The investigation covers 3.2 million Tesla vehicles, which is nearly all Teslas manufactured since 2016. LL

Senior Editor Mark Schremmer contributed to this report.