Lost amid the difficulties Tesla has had ramping up production of its mass-market Model 3, along with other distractions, is that they've squandered an early lead in autonomous technology.

Now Tesla is in the rare position of playing catch-up. On Twitter overnight, CEO Elon Musk acknowledged self-driving is "extremely difficult" and their technology needs more work.

Why it matters: Musk’s ambitious vision to lead the planet toward sustainable energy and safer cars can’t be achieved unless Tesla is financially viable.

Tesla got off track after introducing new Autopilot 2.0 hardware in October 2016 and parting ways with technology partner Mobileye.

• The company promised it would restore Autopilot safety technology by December and then gradually roll out new features — eventually leading up to “fully self-driving capability.”
• But it has taken much longer than expected for Tesla to get the software right.
• Complicating the effort, they're trying to develop a microprocessor to replace the Nvidia chip they currently use.

Where it stands: After two years, today's Autopilot is barely on par with 2016's original system. Yet customers have been paying up to $8,000 extra for Autopilot 2.0 without getting promised features, which is why Tesla offered to reimburse some of their costs to settle a class action lawsuit brought in 2017.

What's new: For the first time, Tesla shared safety stats on Thursday that showed it registered one accident (or near-miss) for every 3.34 million miles driven with Autopilot engaged, compared to one event for every 1.92 million miles driven without Autopilot.

• Overall, government data shows there's an automobile crash every 492,000 miles.

The big picture: Autopilot is making driving safer, but it is far from being a fully self-driving system. Nor is Tesla the only game in town anymore. Other automakers are rolling out their own semi-automated features, some that go beyond what Tesla currently offers.

• GM's Cadillac Super Cruise is the only truly hands-off system (for highway driving only). Others, including Tesla's Autopilot, require the driver to touch the wheel periodically.
• The Mercedes S-Class' Intelligent Drive system can change lanes automatically when the driver taps the turn signal, something Tesla is still working on.
• Other systems like the 2019 Lincoln Nautilis' Co-pilot 360 and Audi's Traffic Jam Pilot feature things like adaptive cruise control, automatic emergency braking and lane keeping assistance.
• Partnerships are popping up everywhere, like Waymo's deals to install AV technology on Chrysler minivans and Jaguar I-Pace crossovers, or Honda's tie-up with GM Cruise to develop autonomous vehicles for global markets.

Go deeper: Read the full story here.

Zero crashes, zero emissions and zero congestion — this is General Motors’ vision, CEO Mary Barra writes for Axios. These potential benefits of self-driving technology can only be fully realized when self-driving cars are deployed in large numbers, and when riders feel comfortable and secure.

What's needed: Federal legislation would provide a path for manufacturers to put self-driving vehicles on the roads safely, while allowing continued innovation. Current federal law prohibits deployment of self-driving vehicles without steering wheels and other conventional driver controls. And other regulations for self-driving cars vary from state to state.

Why it matters: Every year, crashes claim the lives of approximately 1.2 million people around the world — about 40,000 of them in the U.S. And 94% of traffic crashes in the U.S. are caused by human error. Because self-driving vehicles do not operate impaired, tired or distracted, they offer a compelling solution. And when self-driving vehicles are electric, they will help to accelerate the transition to sustainable energy.

What to watch: The SELF DRIVE Act, passed by the House of Representatives, and the AV START Act, pending in the Senate, would direct the National Highway Traffic Safety Administration to issue new and revised safety regulations on an expedited basis. The bills would allow safe self-driving deployment during the period between enactment and NHTSA’s issuance of new regulations, but only by manufacturers that prove their self-driving cars are as safe as human drivers.

The bottom line: Transitioning to a self-driving society will take time, and will require cooperation and collaboration by the private and public sectors. Federal legislation is essential to enabling the journey.

Adaptive cruise control (ACC), which holds a vehicle's speed steady while maintaining a safe distance from traffic ahead, is now a feature in 16 of the 20 bestselling vehicles in the U.S., classifying them as level-1 AVs, Vanderbilt University's Daniel Work writes for Axios.

Why it matters: Phantom traffic jams — the ones that appear to have no obvious cause — result from human driving behavior. ACC replaces some of these jam-inducing behaviors with algorithms, using sensors to detect the vehicle ahead and adjust cruise speed accordingly.

Level-1 AVs hold promise for traffic jam reduction because the vehicles can follow their driving rules faithfully and consistently.

• Driving tests performed on a closed track in Arizona using 1 research-grade autonomous car and 19 human-driven ones suggested that replacing even 5% of the traffic flow with AVs could significantly cut phantom traffic jams, reducing variance in traffic speed 50%–80%.
• Another test at Ford’s Michigan proving grounds showed that ACC reduced the impact of a temporary slowdown. The ACC vehicles were able to maintain a higher speed through the slowdown than the human-driven ones.

Yes, but: A limitation of the current technology is that it can respond only to the vehicle directly ahead, whereas the best human drivers can take in information about many nearby vehicles.

What’s next: More testing is needed to determine how consistently commercially available level-1 AVs will stack up against human drivers. But to surpass human driving capabilities, these systems will need vehicle communication technologies that enable them to respond to more vehicles around them.

• Renault unveils luxury self-driving electric concept car (Brian Pascus — Business Insider)
• Between the lines on Honda's massive investment in Cruise (My Axios debut)
• Fully driverless Waymo taxis are due out this year, alarming critics (Timothy B. Lee — Ars Technica)
• A speed-spotting lidar for self-driving cars (Alex Davies — Wired)
• U.S. will rewrite safety rules to permit fully driverless cars on public roads (Andrew J. Hawkins — The Verge)

Fully autonomous vehicles are still a ways off, but the building blocks are being introduced now. It's important to understand what they do and how they perform, which is why I'll regularly share my insights behind the wheel of some of the most technologically advanced cars on the road. Come along for the ride ...

This week I’m driving a Volvo XC40 AWD T5 Inscription crossover outfitted with Pilot Assist, Volvo’s semi-autonomous drive system with adaptive cruise control.

What it can do: It will keep a safe distance from the car ahead and take the stress off stop-and-go traffic. It will also automatically steer you back to center if you drift outside your lane and use its 360-degree surround camera to park for you.

What it won’t do: It won't relieve you of all driving responsibility. You need to keep your hands on the wheel and pay attention. As with any Level 2 semi-automated system, there’s no napping allowed.

The bottom line: The $32,200 base model comes with a standard collision avoidance system that detects pedestrians, cyclists and even large animals. But the automated features are buried inside various add-on packages that drive the sticker price to $46,290.