American Physical AI company Tensor Auto has signed a letter of intent with Münchner Taxi Zentrum (MTZ), Munich’s largest taxi operator, to explore deploying Tensor Robocars as autonomous taxis in Germany. The proposed partnership would use an operator-led business model in which MTZ operates the vehicles and manages customer relationships, while Tensor supplies the vehicles and autonomous driving technology.
The initial plan targets up to 500 Tensor Robocars in German cities, subject to definitive agreements and Level 4 autonomous driving regulatory approval in Germany. The companies also intend to explore expanding the model to other European taxi operators.
Under the proposed arrangement, MTZ would offer the vehicles under its own brand and integrate them with its existing dispatch systems. Passengers would continue booking rides through MTZ, while the operator would determine where, when and how its autonomous fleet operates.
Operator-Led Model Keeps Taxi Companies in Control
The partnership is designed to allow established taxi operators to introduce autonomous vehicles without transferring their customer relationships or service operations to the technology provider.
Tensor would provide autonomous driving through a recurring subscription called Autonomous Driving as a Service (ADaaS). The service would include driving software, fleet-management tools, ongoing support and training, while MTZ would remain responsible for operating the vehicles.
The companies also envisage financial institutions financing vehicle fleets in cooperation with mobility operators. This structure could help operators expand their fleets without financing every vehicle directly from their own resources.
Tensor said the Robocar was developed specifically for autonomous operation and personal ownership, rather than being converted from a conventional vehicle. The company argues that this design makes the vehicle suitable for both private buyers and commercial fleet use.
Expansion Plans Target European Taxi Networks
The companies cited approximately 50,000 taxis in Germany and 500,000 across Europe as the potential market for the model.
Beyond the initial German deployment, Tensor and MTZ aim to place an additional 10,000 Robocars with European operators within 24 months of the vehicle becoming available in Europe. The proposed expansion would rely partly on MTZ’s industry relationships, including its involvement in Taxis 4 Smart Mobility (T4SM), a coalition of taxi organisations from six European countries chaired by MTZ CEO Gregor Beiner.
The targets remain subject to the partnership’s development, vehicle availability, definitive agreements and relevant regulatory approvals.
Tensor founder and CEO Jay Xiao said MTZ’s experience would support the company’s plans to introduce autonomous taxi services in Germany and expand into other European markets.
“Autonomous driving will redefine urban mobility. At Tensor, we’re building the technology and partner ecosystem to make safe, premium Robocar services a reality at scale. MTZ is an important partner as we bring this vision to Germany and expand across Europe,” said Jay Xiao, Founder and CEO of Tensor.
MTZ Plans to Retain Its Brand and Customer Relationships
MTZ brings more than 40 years of operating experience in Munich, along with established regulatory relationships and approval for commercial operations, according to the companies.
Gregor Beiner said the partnership would allow MTZ to introduce autonomous vehicles while maintaining its existing service identity and customer relationships.
“The taxi industry has a leading role to bring sustainable autonomous driving to Europe. Together with Tensor, MTZ will bring autonomous vehicles to Munich’s streets under its own name, with the service quality and data sovereignty our customers trust. At the same time, our professional drivers remain indispensable: wherever personal service, assistance or a human touch is needed, they make the difference,” said Gregor Beiner, CEO of Münchner Taxi Zentrum.
The proposed model would leave MTZ in charge of customer-facing services, dispatch operations and decisions about fleet deployment. Tensor would provide the technology operating in the background.
The partners also plan to explore offering Tensor Robocars to private buyers in Germany, extending the potential business beyond commercial fleets.
Robocar Designed for Autonomous Fleet Operations
Tensor says the Robocar includes features intended to reduce the time vehicles spend out of service. These include automated maintenance checks, sensor cleaning and the ability to park in ways that protect its sensors.
The company is also developing an agentic AI system that it says can interpret road conditions and respond to passenger requests. Passengers are expected to be able to speak naturally to the vehicle to change a route, add a stop or ask questions during a journey.
The companies have not announced a confirmed deployment date. The proposed launch depends on finalising the agreement and securing Level 4 regulatory approval in Germany, which would permit the vehicles to perform the driving task within their approved operating conditions without continuous human driving supervision.