A California administrative law judge has ruled that Tesla’s license to sell cars in the state should be suspended for 30 days. The decision comes after the California DMV accused the automaker of misleading customers about the actual capabilities of its “Autopilot” and “Full Self-Driving” software.
Back in 2022, the DMV argued that Tesla used deceptive language to sell these features, making it sound like the cars could drive themselves without human help. The judge agreed with the DMV’s evidence that this marketing suggested the cars were fully autonomous, which they are not. However, the state isn’t immediately shutting down Tesla’s showrooms.
Instead of an immediate ban, the agency is issuing an ultimatum to Tesla. The company has a 90-day window to fix its marketing. To avoid suspension, Tesla must remove any untrue or confusing claims from its advertising and explain to the DMV how it plans to comply. If they fail to do this within three months, the 30-day sales ban kicks in.
Tesla has already made small changes, recently adding the word “Supervised” to its “Full Self-Driving” branding. But California DMV Director Steve Gordon says they need to go further. “We’re really asking Tesla to do their job… to brand these vehicles properly,” Gordon stated.
If the suspension goes into effect, it would deal a massive blow to the company. California is the heart of Tesla’s US market, accounting for nearly one-third of its total US sales. It is also a manufacturing hub, housing the Fremont plant where the Model S, X, 3, and Y are built. While Tesla registrations in the state dropped earlier this year, losing access to California buyers completely would be a financial disaster. Now, the clock is ticking for the automaker to rewrite its ads or face the consequences.
