Tesla FSD breaks the ice in Europe! The Netherlands takes the lead in opening the EU regulatory door, validating the trillion-dollar valuation logic

According to the Zhitong Finance APP, the Netherlands Vehicle Authority (RDW) announced on April 11 local time that it has officially approved Tesla's (TSLA.US) "Full Self-Driving Supervised" (FSD Supervised) for use on highways and city streets in the Netherlands, provided that there is human supervision. This means that Tesla has obtained the first official approval for autonomous driving software in Europe, paving the way for subsequent mutual recognition of technology across the EU.

Paving the Way for Widespread Regulatory Approval in Europe

According to RDW, this approval is based on over 1.6 million kilometers of actual road testing and more than 13,000 user test rides. Tesla submitted thousands of pages of compliance documents, ultimately leveraging Article 39 of the EU Regulation 2018/858 to first gain approval from the Netherlands before seeking mutual recognition at the EU level. This "roundabout way" has allowed Tesla to bypass the deadlock of unified certification for advanced autonomous driving features under the EU's new car safety assessment system.

According to the plan, RDW will submit a mutual recognition application to the EU, with a vote expected among EU member states this summer. Currently, countries such as Belgium and Ireland have expressed a tendency to recognize RDW's certification results, but the stance of countries like Germany and France, which have strong domestic automotive industries, remains unclear.

In a statement on Friday, RDW said, "The correct use of this driving assistance system will make a positive contribution to road safety." The statement also added that RDW will submit an application for the technology to be used throughout the EU.

RDW pointed out that the EU's vehicle approval standards are stricter than those in the United States. "This means that the FSD Supervised version in the U.S. is not comparable to the FSD Supervised version in the EU," RDW stated, but did not provide further details.

Tesla posted on social media platform X, stating, "We are excited to soon roll out FSD Supervised technology to more European countries," adding that the technology will soon be launched in the Netherlands.

A Crossroads for the $1 Trillion Valuation Logic

The regulatory breakthrough for FSD in Europe has commercial significance that far exceeds the unlocking of a single feature. It is directly related to the core narrative of Tesla's current valuation—transforming from an automotive hardware manufacturer to an AI-driven software subscription and mobility service platform.

The comprehensive promotion of fully autonomous driving technology is at the heart of Tesla's long-term growth strategy. Its $1 trillion valuation largely depends on CEO Elon Musk's bet that AI-driven autonomous driving software and self-driving taxis will become major sources of revenue.

In February 2026, Tesla eliminated the one-time lifetime buyout option for FSD globally, fully transitioning to a monthly subscription model (USD 99/month in the U.S.). This shift is seen by Wall Street as a key milestone in Tesla's leap from a hardware company to a SaaS (Software as a Service) and AI company. Currently, the global subscription users of FSD have surpassed 1 million, and although there is still a significant gap from the 10 million active user target set in Musk's compensation plan, the stable subscription cash flow expectations have begun to reshape analysts' models Wedbush Securities analyst Dan Ives pointed out that Tesla's revenue structure is undergoing a qualitative change, which will no longer solely depend on quarterly delivery volumes, but rather on "usage frequency + software subscription rates + Robotaxi service commissions."

This narrative is particularly critical against the backdrop of recent fluctuations in European automotive demand, as the company also hopes that FSD technology can help boost vehicle demand. Affected by multiple factors such as product line aging, backlash against Musk's personal political statements, and intensified local competition, Tesla's European sales in 2025 fell by 27.8% year-on-year, with market share shrinking from 2.4% to 1.8%. In February 2026, although European sales recorded the first year-on-year growth in over a year, global delivery volumes in the first quarter still fell short of Wall Street expectations. The rollout of FSD in Europe is expected to boost product demand through software differentiation and restore the brand's technological halo.

The divergence in Wall Street investment banks regarding its valuation prospects has once again drawn significant market attention. Currently, among the 43 analysts covering Tesla, 15 have given a "strong buy," 2 have given a "moderate buy," 17 have given a "hold," and 9 have given a "strong sell," with an average target price of $408.42. The target prices among institutions range from HSBC's $119 to Wedbush's $600, a span of over five times, which is extremely rare in U.S. stocks. Major institutions have formed distinctly divided bullish and bearish camps around the core narratives of FSD and Robotaxi. Whether FSD can achieve mutual recognition across the EU and whether Robotaxi can expand to more than 30 cities as planned in 2026 will be key points to test whether the bullish narrative can be realized