Tesla’s self-driving claims could soon run afoul of new California law

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Under a California law taking effect in the new year, Tesla Inc. and other car manufacturers and dealers will be prohibited from deceptively naming or marketing their vehicles as fully self-driving.

The law, signed by Gov. Gavin Newsom in September, would require car sellers to “clearly” describe the functions and limitations of any partially automated driving features. Those requirements also would apply to software updates for vehicles.

Any violation of the requirements would be punishable as an infraction, meaning possible fines, according to the text of the law. According to the office of State Sen. Lena Gonzalez, who wrote Senate Bill 1398, the amount of any monetary fine will be set later by the California Judicial Council.


has long faced regulatory and legal complaints related to the naming and marketing of its attempts at autonomous-driving options. Among them are lawsuits and federal scrutiny over its so-called Autopilot technology — an advanced driver assistance system, or ADAS — and its role in some fatal crashes. The National Highway Traffic Safety Administration in August opened a formal investigation into Autopilot.

See: Tesla tops list of crashes linked to driver-assist technology, feds say

Tesla also has been sued by customers who say they were defrauded by software that it sells for $15,000 and calls Full Self-Driving, or FSD. The company has sought to dismiss that lawsuit, with its lawyers saying a “mere failure to realize a long-term, aspirational goal is not fraud,” the Los Angeles Times reported earlier this month.

Tesla Chief Executive Elon Musk has made claims for years about fully self-driving capabilities, including promising that Tesla cars would soon function as fully autonomous robotaxis at a 2019 event that took place just before a stock offering. Tesla is not among several companies with approved permits to test fully driverless vehicles in California.

Over the summer, the California Department of Vehicles issued a couple of complaints accusing Tesla of making untrue or misleading statements about the capabilities of both Autopilot and FSD, the latter of which the company has admitted is not actually fully autonomous software in communications with the DMV. The company recently did a demonstration for the DMV and its consultants in response to the DMV’s ongoing investigation, according to Bloomberg.

Opinion: It’s time for Elon Musk to start telling the truth about autonomous driving

“The DMV remains in the discovery stage related to the accusations filed against Tesla regarding the stated capabilities of its ‘Autopilot’ and ‘Full Self-Driving’ features,” a DMV spokeswoman told MarketWatch on Wednesday, adding that the agency would have no further comment until the process is complete.

On its website, the company currently says the following about its autonomous technology:

  • “Tesla cars come standard with advanced hardware capable of providing Autopilot features, and full self-driving capabilities — through software updates designed to improve functionality over time.”

  • On FSD: “The future use of these features without supervision is dependent on achieving reliability far in excess of human drivers as demonstrated by billions of miles of experience, as well as regulatory approval, which may take longer in some jurisdictions.”

  • On Autopilot: “Current Autopilot features require active driver supervision and do not make the vehicle autonomous.”

Tesla no longer has a media-relations department. An email sent to the company by MarketWatch generated an automated response that said the company’s inbox for press inquiries “is full and can’t accept messages now.”

Shares of Tesla have dropped dramatically since Musk bought Twitter Inc. in October, as well as other factors including the company’s recent suspension of production in China. Tesla stock has declined 68% this year after breaking a seven-session losing streak Wednesday, when it closed regular trading up 3.3% at $112.71.

Also: Tesla’s stock breaks record-tying losing streak with best daily gain in nearly a month

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