Tesla stock rose modestly early Thursday as it continues to work toward European approval for its Full Self-Driving driver-assistance product, which could unlock a new stream of earnings for the car maker.
Shares were up about a quarter, or 0.1%, at $321.78 in premarket trading, while S&P 500 and Dow Jones Industrial Average futures were up 0.2% and 0.3%, respectively.
The move comes after Reuters reported that the Netherlands is keeping secret the data it used to approve FSD in the country, which could pose an issue for wider adoption in the European Union.
Tesla didn't respond to a request for comment about the report.
The Netherlands approved FSD a few months ago. FSD is Tesla's highest-level driver assistance product that can do most of the driving most of the time. It still requires human supervision all of the time. ( Barron's has reviewed FSD several times, noting consistent improvement.) Eventually, Tesla hopes to advance its self-driving technology to the point where drivers can legally take their eyes off the road. That is, however, still down the road.
Now that FSD is approved in one EU country, other countries can opt to adopt the Netherlands' decision. Barring that, the European Commission can submit a technical file to the Technical Committee on Motor Vehicles. Then, if 55% of EU countries -- representing 65% of the population -- vote to accept the data, FSD is allowed in the EU.
A vote could happen in October.
If that doesn't happen, Tesla can try the United Nations Economic Commission for Europe, which sets international vehicle standards for more than 50 countries. If two thirds of the vote is in favor of accepting the data, then FSD would be effectively approved in Europe.
That vote could happen in November.
Tesla reported 1.5 million FSD subscriptions at the end of the second quarter, up 56% year over year. At $99 a month, that's almost $2 billion in annual revenue. What's more, Tesla said about 55% of the cars it sold in the second quarter had FSD subscriptions "attached."
All of that revenue is generated in North America. Investors hope Europe contributes to Tesla FSD sales soon.