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Tesla Misled Buyers on Its Auto Pilot Features, Says US Motor Regulator

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Tesla Mislead Buyers on Its Auto Pilot Features, Says US Motor Regulator

The Department of Motor Vehicles (DMV) has filed a complaint stating Tesla advertised its Autopilot and Self-Driving technologies as more capable than they actually are, according to the Los Angeles Times. The DMV report could potentially prevent the automaker from selling its cars in California.

The company "made or disseminated statements that are untrue or misleading, and not based on facts," the DMV is reported to have said in its complaint, filed with the quasi-judicial tribunal the Office of Administrative Hearings on July 28.

Tesla cars could not ever "and cannot now, operate as autonomous vehicles," the DMV said in its report.

Tesla describes its Autopilot as having "full self-driving capability," on its website. "All you will need to do is get in and tell your car where to go," it says. "If you don't say anything, your car will look at your calendar and take you there as the assumed destination."

Tesla includes its Autopilot driver assistance features in all its newly manufactured cars and sells a premium FSD (or Full Self Driving) option for $12,000 up-front or on a subscription basis for $199 per month. Sometimes, the company sells an Enhanced Autopilot option with a portion of the premium features included, according to a business news report.

A ruling in favor of the California regulator could have severe consequences for the electric car maker, including the possible cancellation of the licenses authorizing Tesla to manufacture or sell its cars in the state, according to the LA Times.

As a reprimanding measure, DMV would require Tesla to better educate drivers about its autonomous vehicles and clearly highlight a warning on the limitations of its technology.

Tesla vehicles equipped with autonomous driving software have been involved in 273 accidents in the United States, according to a report released in June by the US National Highway Traffic Safety Administration (NHTSA).

In June, Tesla boss Elon Musk stressed the importance of fully autonomous driving, claiming that without it, the value of his company would be "close to zero."    

Tesla shares plunged at the close of the New York Stock Exchange on Friday,

losing 6.63% to finish at $864.51.

Tesla has fifteen days to respond to the accusations before the administrative court, otherwise the DMV will take a default decision.

In July, the NHTSA opened a special investigation into the crash of a 2021 Tesla Model Y vehicle that killed a motorcyclist in California.

Since 2016, the NHTSA has opened 37 special investigations of crashes involving Tesla vehicles and where advanced driver assistance systems (ADAS) such as Autopilot were suspected of being used. A total of 18 crash deaths were reported in those Tesla-related investigations, including the most recent fatal California crash.

The NHTSA has opened three special probes recently, including one into a Florida crash that killed a 66-year-old Tesla driver and a 67-year-old passenger, and one into a fatal pedestrian crash in California involving a 2018 Tesla Model 3, according to a Reuters news article.

The push for green transportation has led to massive growth for electric vehicles, especially Tesla. In its second-quarter vehicle production and delivery numbers for 2022, Tesla reported total deliveries Q2 2022: 254,695 and total production Q2 2022: 258,580. However, supply chain disruptions in battery components and other equipment has severely impacted Tesla as well as other electrification industry in recent months. Tesla is struggling with high costs of production at new factories in US as well as China plants and is in constant competition with legacy carmakers as well as new carmaker startups.