Tesla Falsely Advertises Autopilot, Full Self-Driving Tech: California DMV

The California Department of Motor Vehicles filed two complaints with the state's Office of Administrative Hearings in July, alleging Tesla's misrepresentation of its ADAS functionality. According to the allegations, Tesla made deceitful claims on its website regarding the capabilities of its systems which may have caused the public to misunderstand the limitations of the company's partially-automated vehicles.

The DMV cites four main pieces of evidence in its complaint. The first two are simply the use of the terms "Autopilot" and "Full Self-Driving," both of which may not represent the actual capability of the system despite being the branded feature names. This is something Tesla has come under fire for previously. In 2020, a ruling by a judge in Germany banned Tesla from advertising its ADAS capabilities in a way that could imply to buyers that the vehicle had autonomous capabilities at the time of purchase, or that such capabilities were legal on Germany's roads.

Despite this, the Autopilot and Full Self-Driving branding has been defended by the company's CEO, Elon Musk.

"It's not like some newbie who just got the car and, based on the name, thought they'd instantly trust the car to drive itself," said Musk in a 2020 interview with Automotive News. "That's the idiotic premise of being upset with the Autopilot name. Idiotic."

However, the DMV says that naming alone isn't the reason that the public may be confused. Two additional pieces of evidence were presented in the complaint, and both surround the way that the automaker's ADAS features are advertised by Tesla on its website. Both examples fall after the "Full Self-Driving Capability" heading on the site, one claiming that "the system is designed to be able to conduct short and long distance trips with no action required by the person in the driver’s seat," and the other noting that all the driver has to do "is get in and tell [their] car where to go."

According to the DMV, the way that Tesla advertises these features do not represent the actual functionality of the vehicle and constitute a deceptive practice under California law. The complaint also acknowledges that Tesla has placed disclaimers on its website which indicate that its ADAS features do not make its vehicles autonomous. However, it states that these disclaimers only contradict the existing language and do not cure the violation itself.

"Instead of simply identifying product or brand names, these 'Autopilot' and 'Full Self-Driving Capability' labels and descriptions represent that vehicles equipped with the ADAS features will operate as an autonomous vehicle," reads the complaint filed by the DMV. "But vehicles equipped with those ADAS features could not at the time of those advertisements, and cannot now, operate as autonomous vehicles."

The DMV's complaint says that repercussions against Tesla could be severe, up to and including the revocation of its license to sell vehicles in the state of California. It also asks the court to consider permitting buyers who suffered financial damage as a result of the company's alleged false advertising to be made whole through restitution. But the DMV doesn't seem to want anything that harsh, at least not right away.

“DMV seeks to require Tesla to provide more accurate terms and descriptions, and more and better consumer education of the product capabilities and limitations,” a DMV spokeswoman said in a statement to MarketWatch.

Elon Musk went on record earlier this year saying that Tesla was "worth basically zero" without its self-driving tech. Despite the recent news of the California DMV's complaint and the potential repercussions (all while the National Highway Traffic Safety Administration is nearing the end of a separate probe that could result in a recall), the company's stock has risen more than 10 percent since the complaint was filed, from $824 the day prior to $911 at the time of writing.

Musk noted during the company's annual shareholder's meeting that he expected all vehicles to eventually have some form of self-driving capability, hinting that Tesla knows it needs to provide its own solution sooner rather than later. Tesla and Musk both know this given that the company has been working on its Autopilot project since 2015, though it has hit several roadblocks along the way in order to keep moving toward a vision-only system. Tesla has also missed many self-set deadlines, including a promised fully autonomous drive across the country that was originally supposed to take place in 2017.

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