Tesla, the car company, and its CEO, Elon Musk, are back in the spotlight, but this time, it’s not about record-breaking deliveries or flashy new tech. Instead, the company is facing serious questions and scrutiny over promises it has made about self-driving cars. From fatal crashes linked to Autopilot to a new class-action lawsuit alleging nearly a decade of exaggerated promises, the controversy raises serious questions about safety, marketing, and the future of autonomous driving.
At the heart of the controversy are Tesla’s Autopilot and Full Self-Driving systems. For years, Musk has painted a picture of cars that can drive themselves, promising futuristic technology that could one day operate without human intervention. But the reality is more complicated. Tesla’s vehicles are still considered Level 2 autonomous, which means drivers have to stay alert and be ready to take control at any moment. Critics argue the company’s marketing has blurred the line, leaving many drivers with the impression their cars are far more capable than they actually are. Tesla simply doesn’t have the extra sensors and tech that other self-driving cars, like Waymo, rely on.
While other self-driving companies were carefully testing their technology with small groups, Tesla started rolling its system out to the general public. That meant making big promises about Full Self-Driving that, in reality, the cars just couldn’t deliver.
The legal pressure is building. A federal judge in San Francisco recently approved a class-action lawsuit accusing Tesla of exaggerating self-driving claims dating back to 2016. This comes on the heels of a high-profile federal case in Miami, where a jury found Tesla partially responsible for a fatal crash involving Autopilot, awarding $243 million in damages. And California regulators are currently investigating whether Tesla misled customers about what its cars can do, a decision that could temporarily affect sales in its biggest U.S. market. And Tesla isn’t just facing scrutiny at home—Tesla is also facing a class-action lawsuit in Australia over reports of “phantom braking,” where vehicles unexpectedly slam on the brakes, raising safety concerns for drivers and passengers.
Tesla has largely defended itself by calling Elon Musk’s bold statements about its self-driving cars “puffery”—exaggerated claims not meant to be taken literally. The company argues its marketing is aspirational and drivers are always responsible for staying alert while using Autopilot or Full Self-Driving. But critics say these lawsuits could set a major precedent, potentially opening the floodgates for more legal action as other drivers and safety advocates challenge Tesla over accidents, misrepresented technology, and unmet promises.
The timing couldn’t be worse for Tesla. The company is already reeling from a 13% drop in global EV sales in the first half of 2025, and its stock is down around 20% this year. Between slowing sales, mounting lawsuits, and international regulators watching closely, Tesla faces a critical moment where its promises, performance, and reputation are all on the line.
