11:07 25-11-2025

Why automakers won't license Tesla FSD: it's about liability

Elon Musk admits automakers aren't licensing Tesla FSD. Brands want autonomy and OEM liability like Mercedes' Level 3, while Tesla won't take liability.

Elon Musk has for the first time acknowledged that automakers are not rushing to license Tesla’s Full Self-Driving. He said negotiations either stall or companies set demands he considers impossible to meet. In plain terms, that signals other brands are waiting for real autonomy and explicit legal accountability, not the beta program Tesla offers its customers.

The licensing idea has been in the air since 2021, when Musk assured investors that carmakers would eventually have to buy Tesla’s technology. In 2024 he even spoke of talks with a major automaker, yet no deal materialized. Ford chief Jim Farley later stated that Waymo was the better option.

The sticking point is the approach. Major manufacturers work to a strict V-model: they define requirements, test, certify, and then accept legal responsibility. Mercedes’ Drive Pilot is an example—the first true Level 3 system in which, once engaged, the manufacturer carries the liability.

Tesla, by contrast, uses its customers as de facto testers by distributing a beta under the Full Self-Driving name. That approach has drawn investigations and lawsuits, including a recent high-profile crash involving a Model Y and a police vehicle that Tesla chose to settle before it reached court.

For brands like Ford, GM, and Toyota, licensing FSD would mean massive legal risk. They expect Tesla to cover it. Tesla, aware of the limitations of a system that runs without lidar and radar, does not agree. So the reluctance to adopt FSD stems less from stubbornness and more from the question of liability that Tesla is not prepared to assume.