Tesla now faces the possibility of being temporarily excluded from doing business in its most lucrative U.S. market—California—unless the company promptly alters what regulators have officially deemed deceptive promotional practices. The California Department of Motor Vehicles (DMV), adopting a recent decision handed down by an administrative law judge, issued a stern warning on Tuesday that Tesla’s current marketing language overstates the autonomous capabilities of its vehicles and therefore breaches state advertising laws designed to protect consumers from misleading claims.
According to the DMV, Tesla’s use of terminology such as “Autopilot” and “Full Self-Driving” in reference to its advanced driver-assistance software systems gives the inaccurate impression that these programs can operate the vehicles independently. In reality, these systems require the constant supervision and active engagement of human drivers. By characterizing these features with terms that suggest a level of autonomy comparable to fully self-driving technology, the agency determined that Tesla was both exaggerating performance and potentially endangering consumers who may rely too heavily on automation. As a consequence, the DMV has ordered that Tesla could face a 30-day suspension of its license to sell new vehicles in California—its largest domestic market—unless the company amends the marketing and presentation of its “Autopilot” feature within a strict 60-day compliance period.
Despite this significant enforcement action, the agency stopped short of imposing the harsher penalty initially recommended by the judge: a suspension of Tesla’s manufacturing license in the state. Such a sanction would have effectively halted production operations and inflicted severe financial losses, a particularly damaging outcome given the electric vehicle sector’s current volatility. The industry has recently been grappling with declining demand, partly attributed to the expiration of government tax incentives that previously stimulated electric vehicle purchases. Thus, while the DMV’s restraint avoids triggering an industrial shutdown, the ruling nevertheless places intensified pressure on Tesla to align its marketing with factual performance claims.
Bringing Tesla into compliance may require the company to undertake a significant rebranding effort concerning its driver-assistance technologies. The automaker currently markets two levels of assisted-driving features under the labels “Autopilot” and “Full Self-Driving.” However, regulators emphasize that these systems—unlike the fully autonomous operations pioneered by robotaxi developers such as Waymo—do not enable the car to function independently in any scenario. Instead, drivers are required to maintain full attention, keep their hands on the wheel, and remain ready to assume control at all times. Consequently, the upcoming months could see Tesla reworking its branding, consumer disclosures, and possibly software naming conventions in order to reflect a clearer, more accurate representation of what its technology can and cannot do.
This decision follows a long-running investigation by the DMV into Tesla’s marketing practices. The agency previously petitioned an administrative judge to determine whether the automaker’s advertising methods warranted a temporary suspension of its operational licenses within the state. In its arguments, the DMV asserted that Tesla had for years disseminated statements and promotional materials that, either explicitly or by implication, led potential customers to believe that its vehicles were capable of full self-driving functionality. In fact, no Tesla model has ever achieved true autonomy under any recognized technical standard. Tesla, in its defense, has categorically rejected these allegations, maintaining that it has consistently communicated the limitations of its autopilot features and made clear that human drivers must remain in control at all times. Nevertheless, the DMV’s adoption of the judge’s ruling marks a formal acknowledgment that the agency considers the company’s language to have crossed the boundary between aspirational marketing and legally misleading advertising.
Sourse: https://www.theverge.com/news/846152/tesla-autopilot-marketing-deceptive-california-dmv
