As Elon Musk touts robotaxis in Austin, federal regulators are investigating whether the system is dangerous even with a human behind the wheel. Bloomberg's Craig Trudell reports. The setting sun was blinding drivers on the Arizona interstate between Flagstaff and Phoenix in November 2023. Johna Story was traveling with her daughter and a co-worker in a black Toyota 4Runner around a curve that turned directly into the glaring sunlight. They pulled over to help direct traffic around two cars that had crashed. Back before that curve, Karl Stock was behind the wheel of a red Tesla Model Y. He had engaged what the carmaker calls Full Self-Driving, or FSD — a partial-automation system Elon Musk had acknowledged 18 months earlier was a high-stakes work in progress. In a few harrowing seconds, the system’s shortcomings were laid bare by a tragedy. The Tesla hit Story, a 71-year-old grandmother, at highway speed. She was pronounced dead at the scene. Story’s death — one of 40,901 US traffic fatalities that year — was the first known pedestrian fatality linked to Tesla’s driving system, prompting an ongoing federal investigation into whether Full Self-Driving poses an unacceptable safety risk. Bloomberg News is publishing photos and partial footage of the crash, which was recorded by the Model Y and downloaded by police, for the first time after obtaining the images and video through a public-records request. As the National Highway Traffic Safety Administration investigates whether Tesla’s human-supervised driving system is potentially defective, the company is proceeding with plans to deploy a small number of vehicles without anyone behind the wheel. Tesla has already started putting driverless Model Ys on public roads for testing in Austin ahead of plans to launch a driverless taxi service on June 12, Bloomberg reported last week. What regulators still want to know is whether Tesla’s cars will be capable of confronting conditions similar to those in the 2023 crash. A spokesperson for NHTSA said the agency will take any actions necessary to protect road safety. After spending years investigating Autopilot — a different suite of Tesla driver-assistance features — the regulator found that the carmaker hadn’t done enough to prevent drivers from misusing the features. Tesla then recalled 2 million cars. Representatives for Tesla, including Musk, the company’s chief executive officer, didn’t respond to a list of questions from Bloomberg. Bryant Walker Smith, a lawyer and engineer who advises cities, states and countries on emerging transportation technologies, warned that Tesla’s push to deploy driverless cars may be premature. “They are claiming they will be imminently able to do something — true automated driving — that all evidence suggests they still can’t do safely,” he said. Johna Story woke up early the morning of Nov. 27, 2023, to take her grandchildren to school. She and her daughter, Sarah, then headed to Phoenix Sky Harbor International Airport, where they worked transporting vehicles for a rental-car company. That evening, Johna, Sarah and a co-worker, Brian Howard, were driving the Toyota 4Runner from Flagstaff to Phoenix when they came upon an accident shortly after the curve on Interstate 17. Howard exited the SUV and walked back behind the initial crash scene to alert oncoming traffic. Johna stepped out of the front passenger-side door and put on an orange reflective safety vest. The Tesla driver, Karl Stock, was traveling at 65 miles per hour in his Model Y, according to the crash report police compiled. As multiple cars ahead began to brake or came to complete stops near the scene of the first crash, the footage appears to show the Tesla maintained its speed. The Model Y swerved to the left just as it sped past Howard, who stood on the shoulder of the interstate, whipping what appears to be a safety vest in the air. The Tesla jerked back to the right and hit Johna Story head-on with the front bumper, hood and windshield, sending her body tumbling through the air. -------- Watch Bloomberg Radio LIVE on YouTube Weekdays 7am-6pm ET WATCH HERE: http://bit.ly/3vTiACF Follow us on X: https://twitter.com/BloombergRadio Subscribe to our Podcasts: Bloomberg Daybreak: http://bit.ly/3DWYoAN Bloomberg Surveillance: http://bit.ly/3OPtReI Bloomberg Intelligence: http://bit.ly/3YrBfOi Balance of Power: http://bit.ly/3OO8eLC Bloomberg Businessweek: http://bit.ly/3IPl60i Listen on Apple CarPlay and Android Auto with the Bloomberg Business app: Apple CarPlay: https://apple.co/486mghI Android Auto: https://bit.ly/49benZy Visit our YouTube channels: Bloomberg Podcasts: https://www.youtube.com/bloombergpodcasts Bloomberg Television: https://www.youtube.com/@markets Bloomberg Originals: https://www.youtube.com/bloomberg Quicktake: https://www.youtube.com/@BloombergQuicktake