The California Department of Motor Vehicles (DMV) has initiated legal action against Tesla, accusing the company of false advertising regarding its “Autopilot” and “Full Self-Driving” features. The DMV is seeking a 30-day suspension of Tesla’s license to sell electric vehicles (EVs) in California while the court considers potential fines or other consequences. Tesla is preparing to contest these allegations vigorously. If the DMV’s suspension request is approved, it could severely impact Tesla, especially after a notable decrease in sales during the first half of 2025, attributed to factors such as the federal administration’s lack of support for EVs and unpredictable tariffs. The suspension would be detrimental to Tesla’s recovery efforts, which have so far seen renewed sales momentum as customers rush to purchase before the expiration of the Federal EV tax incentive this September.
For Californian consumers, a suspension could lead them to explore other EV brands such as Hyundai, Ford, General Motors, and Honda, which still qualify for tax incentives. Meanwhile, outside California, a 30-day suspension could cause Tesla to shift inventory to markets less affected by the legal issues. The resolution of this legal battle remains uncertain as the court proceedings unfold.
The DMV has alleged that Tesla is misleading customers regarding the capabilities of its advanced driver assistance systems (ADAS), particularly through the naming of its features like “Full Self-Driving” and “Autopilot.” The DMV claims Tesla’s marketing overstates the technology’s abilities, creating unrealistic expectations about vehicle autonomy. This situation dates back to July 2022 when the DMV first took action, with the lawsuit’s claims revised in November 2023. The National Transportation Safety Board previously criticized Tesla for similar misrepresentations in 2021.
Tesla’s defense argues that the DMV has known about the company’s terminology since the features were first introduced, implying that the DMV’s approval was implicit over the years. Tesla maintains that it has made clarifications regarding its product descriptions, particularly displaying “Full Self-Driving (Supervised)” on its website and highlighting that the system requires active driver supervision. The DMV, however, contends that these adjustments do not suffice and insists on addressing the alleged misleading practices in court.
CNET reaffirms the distinction between Tesla’s driver assistance technologies and true autonomous driving systems, emphasizing the necessity for driver engagement when using these features. This stance aligns with industry standards set by organizations like the Society of Automotive Engineers (SAE), reflecting the understanding that current technologies are not fully autonomous and require driver awareness and involvement to ensure safety.
Ultimately, the legal confrontation between Tesla and the California DMV raises important considerations about consumer perception of automotive technologies and the definitions of vehicle autonomy. As the automotive industry evolves rapidly, regulatory bodies and car manufacturers face the imperative of transparency in marketing advanced technologies, ensuring that consumers make informed decisions about their purchases while remaining aware of the current limitations of EV capabilities.
