This week, Tesla fans apparently have a lot of eyes on the company’s annual shareholder meeting. However, for this global leader in the electric car industry, there was apparently a lot of trouble around the AGM. The California Department of Motor Vehicles (DMV) has accused Tesla last week of false advertising in promoting the company’s signature self-driving and fully automated driving technology, local media reported Friday (Aug. 5).
The agency says the electric car maker misled customers in the language of ads on its website that exaggerated the capabilities of its Autopilot and fully automated driving technology.
The allegation could affect Tesla’s car sales business in California. If the regulator’s complaint to the California Office of Administrative Hearings (Office of Administrative Hearings) is successful, Tesla’s license to manufacture and sell cars in California could be suspended or revoked.
In two complaints filed with the state Office of Administrative Hearings on July 28, the DMV reportedly said that “in advertising that the vehicles are or may be equipped with advanced driver assistance system (ADAS) features, Tesla disseminated untrue or misleading statements that were not supported by the facts.”
The DMV said that despite Tesla’s statements that these procedures “require active driver oversight,” advertising is still misleading.
Autopilot function is controversial
Tesla’s Autopilot system, an autonomous driving assistance system, has been one of the company’s main vehicle selling points since its launch in 2015 and has helped the automaker stand out in an increasingly crowded electric vehicle market.
The Autopilot system enables automatic assisted steering, acceleration and braking in the lane. But it is designed primarily for use on the highway. Tesla also says that when using the system, the driver must keep both hands on the wheel to maintain control of the vehicle.
Autopilot gets its name from the aviation system that allows aircraft to fly on their own under ideal conditions with limited pilot operation. In the current system, a Tesla car will disengage from Autopilot if the driver fails to keep his or her hands on the steering wheel at all times.
Owners can pay an additional $12,000 for a one-time purchase of the Fully Automated Driving feature (FSD), or they can take a subscription for $199/month. It is reported that as of the end of the second quarter of this year, more than 100,000 Tesla owners have used the FSD beta feature in North America.
Musk said that fully automated driving will be “fully functional” by the end of this year for about one million owners.
The prospect of self-driving and fully self-driving cars is already an important reason for Tesla’s high valuation. According to Tesla’s full-year 2021 earnings report, the services and other business, including self-driving software, achieved revenue of $3.802 billion, an increase of 65% year-on-year, accounting for 7.06% of total revenue.
In recent years, however, reports of crashes caused by Tesla’s Autopilot system have also been in the news. A report released by the National Highway Traffic Safety Administration (NHTSA) in June of this year showed that 70 percent of accidents involving driver-assist technology involved Tesla’s electric cars, 60 percent of accidents resulting in serious injuries, and 85 percent of accidents resulting in fatalities.
Just last Sunday, a motorcyclist in Draper, Utah was struck by a Tesla driver using Autopilot, killing the motorcyclist instantly. The crash also caught the attention of the NHTSA. The agency suspects that the primary cause of the crash may have been due to a malfunction in Tesla’s Autopilot, which was unable to recognize the motorcycle on autopilot at highway speeds.
Tesla has until next Friday to dispute or respond to the DMV’s allegations.
State Senator Lena Gonzalez, chairwoman of the U.S. Transportation Committee, called the DMV’s allegations against Tesla “very troubling” indeed. She said, “It is extremely important to demonstrate the limitations of this technology in the most understandable way to best protect public safety on California’s roads.”
