California passes law banning Tesla from calling software FSD

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California passed a new law prohibiting Tesla from calling its software Full Self-Driving (FSD). While Tesla never claimed the FSD was fully autonomous, the electric maker is developing the technology for fully autonomous vehicles. Until their vehicles are fully autonomous, drivers must be alert and ready to take control at all times when activating FSD or Autopilot.

California lawmakers, however, disagree with the FSD labels. Senate Bill 1398 was one of hundreds that Governor Newsom signed into law. The new law takes effect in 2023 and specifically targets Tesla’s name for its software. The bill was sponsored by Senate Transportation Committee Chair Lena Gonzalez, who claimed that Tesla falsely advertised its technology and that it was a safety issue.

The bill was sponsored after the California Department of Motor Vehicles claimed that Tesla’s FSD was “false advertising”.

An excerpt from the new law reads as follows:

“A dealer or manufacturer must not sell any new passenger vehicle that is equipped with any Partial Driving Automation feature or provide any software update or other vehicle upgrade that adds any Partial Driving Automation feature without, at the time of vehicle delivery or upgrade, provide the purchaser or owner with a separate notice that provides the name of the feature and clearly describes the features and limitations of the feature”.

“A manufacturer or dealer must not name any part-drive automation feature or describe any part-drive automation feature in marketing materials using language that implies or causes a reasonable person to believe that the feature allows the vehicle to function as a autonomous vehicle, as defined in Section 38750, or otherwise has functionality not actually included in the feature. A violation of this subdivision will be considered false advertising for the purposes of Section 11713.”

On its Full Self-Driving Capability website, Tesla says all new vehicles have the necessary hardware in the future for FSD.

“The system is designed to be able to drive both short and long distance trips with no action required from the person in the driver’s seat.”

“Future use of these features without oversight is dependent on achieving reliability far beyond that of human drivers, as demonstrated by billions of miles of experience, as well as regulatory approval, which may take longer in some jurisdictions.”

“As these self-driving features are introduced, your car will be continually updated through over-the-air software updates.”

In November, a Tesla owner involved in a Thanksgiving accident claimed the FSD was faulty, however police are still investigating the driver’s claims. In August, Tesla Autopilot software director Ashok Elluswamy shared data showing how Tesla’s Autopilot software prevents around 40 daily crashes that would be caused by sudden, unintentional acceleration. Several owner accounts are crediting Autopilot and the FSD with saving their lives.

Disclosure: Johnna is a shareholder in $TSLA and believes in Tesla’s mission.

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California passes law banning Tesla from calling software FSD