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Switzerland has a couple of tunnels in operation that have short haul trains running through them that you drive your car onto. They don't check what kind of cars are on the train, as long as they fit you're good.

Yes, but those tunnels are not as narrow as Musk suggests and have good ventilation and an emergency exit every 100m or so. Source: Swiss that used the said tunnel multiple times.

You also need hardcore vent systems.

The tunnel could allow just Teslas - with their ultra fancy air filters you could set off a chemical weapon inside the tunnel and everyone in the cars would still be fine :D

By the time these tunnels are ready (if ever), urban private transportation will probably be primarily electric anyways.