California’s Department of Motor Vehicles (DMV) accused Tesla in July 2022 of misleading customers in its marketing of vehicles equipped with the company’s autopilot and self-driving technology (FSD). A judge in the state’s Office of Administrative Hearings (OAH) rejected the electric car manufacturer’s attempt to dismiss the accusation, as reported by Reuters.
The accusation stated, „At the time of the advertisements, and even now, the vehicles have not been able to operate as autonomous vehicles.“
Risk of Losing License
DMV has not commented on the decision but informed the news agency that the accusation will be formally reviewed in a hearing before OAH on September 9th of this year. If the accusation proves to be true, Tesla risks having its license to sell cars in the state revoked and may be required to compensate customers.
Monday’s decision comes after a federal judge in San Francisco on May 15th denied Tesla’s attempt to dismiss a proposal for a nationwide class-action lawsuit alleging that the company misled consumers into believing that the vehicles would soon have self-driving capabilities.
Investigating Possible Fraud
Tesla has been under federal scrutiny for many years regarding whether FSD may have contributed to fatal accidents. Three sources familiar with the matter told the news agency that federal authorities are conducting separate investigations into whether the electric car manufacturer committed fraud by misleading investors about self-driving technology.
The company, which Elon Musk invested in back in 2004, has acknowledged that neither autopilot nor FSD makes the car self-driving and does not excuse drivers from paying attention to the road.
California is Tesla’s largest market in the US, accounting for around 10% of global deliveries. However, in the first quarter of this year, the market share in the state dropped to 55.4%, down from 61.8% in the first quarter of last year.
In conclusion, Tesla’s legal battles and regulatory challenges regarding its autopilot and self-driving technology continue to unfold. The outcome of the upcoming hearing before OAH will shed more light on the allegations of misleading marketing practices. The investigations into possible fraud and the potential consequences for Tesla’s operations in California highlight the importance of transparency and accountability in the development and promotion of advanced automotive technologies.