When it comes to self-driving cars, the gap between "pretty good" and "actually autonomous" turns out to be enormous. That's the gist of recent commentary from Ross Gerber, co-founder of investment firm Gerber Kawasaki, who took to social media this week to assess where Tesla Inc. (TSLA) and Alphabet Inc. (GOOGL) (GOOG)'s Waymo stand in the race to dominate autonomous vehicles.

Tesla's FSD Gets Better, But Still Needs a Babysitter

Gerber shared his experience testing Tesla's Full Self-Driving system on Thursday, noting that FSD v14.2 "drives much better than before." That's genuine progress, especially considering he'd previously panned version 13 as "not good." The latest v14.1.7 update earned praise as "a big step up," though Gerber pointed out lingering mapping issues.

But here's the catch: better doesn't mean good enough. "I'm impressed with the progress but it's still not good enough to be 'unsupervised,'" Gerber wrote. "It's a level 2 system." In plain English, that means drivers still need to keep their hands on the wheel and eyes on the road, ready to take over at any moment.

What would it take to reach Level 3 autonomy? According to Gerber, Tesla would need to do something it hasn't done yet: assume liability for accidents caused by the system. Right now, if FSD messes up and causes a crash, that's on the driver. If Tesla were willing to take that risk onto itself, "that would be a major admission of progress," Gerber explained. "Tesla taking the risk changes it to a level 3 or above system."

Meanwhile, Waymo Is Already There

In a separate post, Gerber painted a very different picture of Waymo's technology. He described Waymo's systems as Level 4 autonomy—genuinely unsupervised driving that doesn't require a human safety driver. "Waymo is well ahead in the robotaxi business and getting further by the week," he wrote, calling them the clear "leader" with "operations are scaling rapidly."

The timing is notable. Waymo just announced it's now operating on highways across multiple cities, and crucially, those vehicles don't have safety drivers on board. Compare that to Tesla's Austin robotaxi pilot, where Elon Musk has promised driverless operations by year-end but hasn't delivered yet.

Gerber did note that running a robotaxi business still requires humans behind the scenes—just not in the driver's seat. But when it comes to the technology itself, Waymo appears to have a meaningful lead.

Tesla Clears a Nevada Hurdle

Despite the gap, Tesla just scored a win in its robotaxi ambitions. The company recently obtained self-certification in Nevada that allows it to deploy autonomous vehicles in the state, opening the door for commercial operations. It's a regulatory milestone that brings Tesla closer to competing directly with Waymo, even if the technology still has catching up to do.

Price Action: TSLA shares climbed 1.71% to close at $426.58, according to market data.