Both companies are headquartered in California but had previously concentrated their autonomous testing in Texas because of their home state's decade-long prohibition .
On April 28, 2026, the California DMV adopted new autonomous vehicle regulations — described as the most comprehensive AV rules in the state — that for the first time removed the prohibition on operating autonomous heavy-duty vehicles with a gross vehicle weight rating (GVWR) over 10,001 pounds on California public roads . The regulations were approved by the Office of Administrative Law the same day
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The new rules did more than lift the heavy-vehicle ban. They created a structured, phased permitting pathway:
Enforcement also tightened significantly. As of July 1, 2026, law enforcement officers can issue a "Notice of AV Noncompliance" when a driverless vehicle commits a moving violation — and manufacturers must respond within 72 hours . This closes a loophole that had gained attention in September 2025, when San Bruno police could not ticket a robotaxi that ran a red light
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Both permits issued to Aurora and Kodiak are strictly "drivered" permits — meaning a human safety driver must be behind the wheel at all times . No driverless testing is authorized at this stage.
Additional restrictions include a prohibition on operating on roads with speed limits of 25 mph or less, except when necessary to reach a direct route . Kodiak confirmed its testing is focused on highways, with some surface street driving included
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Aurora Innovation launched the first commercial driverless trucking service in the U.S. on May 1, 2025, operating Class 8 autonomous trucks on a regular roundtrip route between Dallas and Houston without a human occupant in the vehicle . The company has since expanded routes from that initial corridor
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Kodiak AI began commercial driverless operations in the Permian Basin (Texas) in January 2025, hauling freight autonomously in the oilfield region before applying for its California permit . Both companies had logged millions of autonomous miles on Texas highways before seeking California permits under the new rules
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On August 5, 2026, Teamsters California filed a lawsuit in Alameda County Superior Court against the California DMV and other state agencies, seeking to void the April 28 regulations . The union's core argument centers on process, not technology itself.
Key allegations in the lawsuit:
The lawsuit does not challenge the safety of autonomous technology directly; rather, it argues that the DMV skipped a legally required deeper economic review — a standardized regulatory impact assessment that California law demands once a regulation's projected cost clears rough thresholds .
California's new AV regulations create the nation's first formal pathway for heavy-duty autonomous freight operations, but progress through the three-phase gate system will be measured in years. Aurora and Kodiak are now the first companies in line, but only time — and the courts — will tell how quickly that line moves.
The Teamsters lawsuit is scheduled to proceed in Alameda County Superior Court, with oral arguments expected in the coming months. A ruling that voids the regulations could send the DMV back to the rulemaking stage, potentially delaying heavy-duty autonomous testing in California by years. If the rules survive the legal challenge, the next milestone to watch is whether either company reaches the 500,000 supervised-mile threshold required for a driverless testing permit.