U.S. to loosen rules on Tesla, other carmakers taking on China in race for self-driving cars

Transportation Secretary Sean Duffy speaks during a news conference, March 11, 2025, at the Department of Transportation in Washington. (AP Photo/Jacquelyn Martin, file)

NEW YORK (AP) — The Trump administration is loosening rules to help U.S. automakers like Elon Musk’s Tesla develop self-driving cars so they can take on Chinese rivals.

U.S. companies developing self-driving cars will be allowed exemptions from certain federal safety rules for testing purposes, the Transportation Department said Thursday. The department also said it will streamline crash reporting requirements involving self-driving software that Musk has criticized as onerous and will move toward a single set of national rules for the technology to replace a patchwork of state regulations.

“We’re in a race with China to out-innovate, and the stakes couldn’t be higher,” said Transportation Secretary Sean Duffy in a statement. “Our new framework will slash red tape and move us closer to a single national standard.”

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The new exemption procedures will allow U.S. automakers to apply to skip certain safety rules for self-driving vehicles if they are used only for research, demonstrations and other non-commercial purposes. The exemptions were in place previously for foreign, imported vehicles whose home country rules may be different than those in the U.S.

The decision comes a day after Musk confirmed on a conference call with Tesla investors that the electric vehicle maker will begin a rollout of self-driving Tesla taxis in Austin, Texas, in June.

It’s not clear how the exemptions from National Traffic Safety Administration rules will affect Tesla specifically. The company has pinned its future on complete automation of its cars, but it is facing stiff competition now from rivals, especially China automaker BYD.

The crash reporting rule being changed has drawn criticism from Musk as too burdensome and unfair. Tesla has reported many of the total crashes under the rule in part because it is the biggest seller of partial self-driving vehicles in the U.S.

Traffic safety watchdogs had feared that the Trump administration would eliminate the reporting rule. The transportation statement Thursday said reporting will be loosened to “remove unnecessary and duplicative” requirements but that the obligation to report crashes will remain.

Bernard Condon, The Associated Press