Tesla is facing a new legal challenge over its Full Self-Driving (FSD) technology, this time in China. The lawsuit comes as the automaker continues to push to receive approval for the advanced driver-assist system in the country.
According to a report from the Beijing News, a court has now held its first hearing in a lawsuit filed by 10 Tesla owners who allege the company misled customers about the capabilities of its FSD package.
The plaintiffs are collectively seeking more than 3.95 million yuan (C$807,000/US$583,000) in damages, arguing Tesla marketed features that either were not available in China or could not function as promised on their vehicles.
The case centres largely around Tesla’s older HW3-equipped vehicles, which were sold between 2019 and 2023. Owners claim they purchased the FSD package after being told the vehicles would eventually receive “full self-driving capability,” only to later discover newer FSD features in China were limited to Tesla’s newer HW4 hardware.
Beijing News reports there are nine plaintiffs seeking refunds and triple compensation specifically tied to the FSD package, while another owner is pursuing compensation for the entire vehicle, claiming autonomous driving capability was the deciding factor behind the purchase. (via Bloomberg)
Tesla reportedly argued in court that some FSD-related functions have already been achieved, while others remain under development.
FSD still not fully approved in China
The lawsuit arrives at an awkward time for Tesla, particularly after several mainstream media outlets incorrectly reported last week that FSD had fully launched in China.
As we reported however, Tesla still does not have full regulatory approval for its latest-generation FSD (Supervised) system in the country. Chinese customers currently only have access to a more limited version of Tesla’s software, marketed locally as “Tesla Assisted Driving” (TAD) or “Intelligent Assisted Driving.”
The lawsuit could also become much bigger than just 10 owners. Reports suggest hundreds of additional Tesla owners in China are now consulting lawyers about similar claims, particularly owners of HW3 vehicles that may never support Tesla’s latest FSD capabilities.
Part of a broader global challenge
The issue is not limited to China either. Tesla is already facing similar legal pressure in other regions after Elon Musk acknowledged last year that HW3 hardware would not achieve the same level of autonomy as newer HW4-equipped vehicles.
Australia is currently dealing with a large class-action lawsuit related to FSD and Autopilot claims, while European owners have also begun organizing collective legal action.
While the damages being sought in this Chinese case remain relatively small for now, the lawsuit could set an important precedent for how Tesla markets future driver-assistance technologies globally.
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