Background Bluetooth processing time expired
Should the background processing time for Bluetooth expire on the watch, so passive entry with only the watch doesn't work, keep in mind that Siri can open apps pretty reliably. Just raise your watch and say "Hey Siri, open Watch for Tesla" and Bluetooth direct control will immediately connect and allow vehicle to unlock and drive. Background processing time will reset after 24 hours, after which full passive entry will start working again.