Tesla could soon be blocked from selling vehicles in California for 30 days as the state’s Department of Motor Vehicles (DMV) escalates its case against the company’s marketing of Autopilot and Full Self-Driving (FSD) technology. The DMV has accused Tesla of misleading consumers by overstating the capabilities of its driver-assistance systems, which still require active driver supervision.
The dispute centers on Tesla’s use of terms like “Autopilot” and “Full Self-Driving,” which the DMV argues implies autonomous functionality that the vehicles do not possess. While Tesla includes frequent warnings that drivers must remain attentive, the agency says these disclosures are not enough to offset claims suggesting that the car can operate independently.
DMV Targets Tesla’s Dealer License
According to filings, reported by Bloomberg, the DMV is seeking to suspend Tesla’s manufacturer and dealer license for “not less than 30 days.” If approved, Tesla would be barred from selling vehicles in California, the largest car market in the United States, dealing a significant blow to the automaker. Financial restitution is also being sought, with the final amount to be determined in future hearings.
The case stems from advertising statements made between 2021 and 2022, including one that described FSD as being able to handle “short and long-distance trips with no action required in the driver’s seat.” The DMV argues that such statements violate state law prohibiting “untrue or misleading” marketing.
Tesla Pushes Back
Tesla disputes the allegations, claiming that its statements are “future-facing” and protected by the First Amendment. The company argues that its marketing is being taken out of context and that it has consistently clarified that its vehicles are not fully autonomous. In court filings earlier this year, Tesla stated, “Tesla repeatedly and explicitly makes clear that its vehicles are not autonomous and require active driver supervision.”
What’s Next?
The outcome of the California DMV hearing could have major implications for Tesla. A temporary sales ban in its largest market would not only hurt Tesla’s bottom line but also cast doubt on its long-term strategy for autonomous vehicles.
