Senators Push for FTC Probe into Tesla\u2019s Full Self-Driving Claims

Days after the NHTSA has launched an investigation into instances of Tesla’s cars colliding with first responder vehicles while on Autopilot, two U.S. senators have written a letter to Federal Trade Commission urging a probe into the automaker’s so-called Full Self-Driving system, which the automaker has been rolling out in beta-testing form over the past several months to some Tesla drivers. The senators cite a number of statements Tesla and CEO Elon Musk have made about Full Self-Driving as well as Autopilot, in which the company and its CEO have allegedly overstated the system’s capabilities, leading buyers to believe that the cars really are self-driving.

“Tesla’s marketing has repeatedly overstated the capabilities of its vehicles, and these statements increasingly pose a threat to motorists and other users of the road,” the letter claims. “Accordingly, we urge you to open an investigation into potentially deceptive and unfair practices in Tesla’s advertising and marketing of its driving automation systems and take appropriate enforcement action to ensure the safety of all drivers on the road.”

The Senators’ letter to the FTC follows a number of developments for what Tesla’s Full Self-Driving this year, which has seen at least one major software update and a wider rollout of the feature, allowing the system to operate on city streets, as opposed to highways, to which Autopilot use was largely confined. The system has received criticism from a number of industry observers earlier this year for pushing what Tesla has admitted is an SAE Level 2 technology, into environments and situations beyond its capabilities, while supporters of the system have cautioned that FSD is a beta release only for the most careful drivers and Tesla employees.

Weeks ago Tesla has also begun offering FSD via a monthly subscription basis for $199 a month, but has run into the issue of some cars not having the necessary hardware, requiring users to purchase over $1,000 in new hardware to use the system (they already paid for months or years prior). Tesla also sells the system for a one-time fee of $10,000.

“We fear that Tesla’s Autopilot and FSD features are not as mature and reliable as the company pitches to the public,” the letter adds. “On April 22, 2019, Tesla posted a video on its YouTube channel titled ‘Full Self-Driving’ showing a Tesla driving entirely on its own. Tesla CEO Elon Musk has also repeatedly boasted about Tesla’s systems. In July 2020 and again in January 2021, Mr. Musk claimed to consumers that Tesla vehicles would soon reach Level 5 autonomy, or full automation. Unfortunately, Tesla’s advertising and marketing is reaching a large audience: the ‘Full Self-Driving’ video has been viewed more than 18 million times. While Tesla has buried qualifying disclaimers elsewhere on their website, the link in the video’s caption redirects to a purchasing page that fails to provide additional information about the true capabilities of the vehicle.”

The disclaimers the letter refers to are ones requiring drivers to maintain their attention on the road, remain alert and keep their hands on the steering wheel. The company has also cautioned that FSD may do “the wrong thing at the worst time.”

Earlier this year Tesla has also moved to reduce the variety of sensors on which FSD relies, indicating that it intends to transition to visual-only sensors, instead of cameras and radar.

The Senators’ letter is also notable for conflating the Full Self-Driving subscription and hardware with the beta release of Full Self-Driving, with the latter actually being used by just a few thousand private owners and Tesla employees to test the latest features. The former, on the other hand, is more limited in nature and does not offer the latest features being tested in beta form, but is more widely available. Of course, the letter’s failure to make a distinction between these versions of the system is not particularly surprising, given the number of versions of systems that still nominally remains Level 2, by Tesla’s own admission.

But it’s notable that if a letter written by Senate staffers and signed by U.S. Senators can’t keep these versions of the software separate, then the average car buyer may have an even lesser chance of doing so.

The letter saves the most biting allegations for the end.

“Mr. Musk’s tepid precautions tucked away on social media are no excuse for misleading drivers and endangering the lives of everyone on the road,” the letter adds. “As Tesla makes widely available its FSD and Autopilot technology and doubles down on its inflated promises, we are alarmed by the prospect of more drivers relying more frequently on systems that do not nearly deliver the expected level of safety.”

The Senators urge the FTC to open an investigation into the “repeated and overstated claims” of FSD and Autopilot, and also to implement enforcement actions to prevent death and injury as a result of these features.

While it is somewhat surprising that it took elected officials, if not regulators, until the second half of 2021 to notice that Tesla has been selling something named “Full Self-Driving” in multiple countries for several years while suggesting it has capabilities that exceed SAE Level 2, while telling California regulators that the system is merely Level 2 and is not self-driving, it remains to be seen whether the FTC or any other government agency will actually take the step of mandating any changes to Tesla’s marketing of FSD or its features, or the beta testing of software by some users on other road users who did not sign up for this testing. Federal regulation of autonomous systems has not been especially evident since the arrival of the first Level 2 prototypes on the streets, while regulations in each state have differed greatly in that regard, at least on paper if not in practice.

The FTC, we should note, usually deals with the marketing aspects of products rather than their operation. When it comes to the scope of their permitted usage on the street and related safety issues, the NHTSA is one of the agencies that, at least on paper, regulates these systems through administrative rulemaking. We should also note that Tesla does not engage in advertising per se in the U.S., at least in the traditional sense of the word.

The state-by-state approach has already caused a number of foreign automakers, including Honda, to not bother introducing Level 2 and Level 3 systems in the U.S., citing regulatory uncertainty and the costs of dealing with 50 different jurisdictions just in one country, while Tesla has largely ignored the SAE levels entirely in its representations of FSD to consumers. At the same time, it’s also obvious that regulatory scrutiny has not prevented Tesla from offering Level 2 systems in all 50 states and a number of foreign countries, and has not prevented Tesla from calling systems that are not SAE Level 5 “Full Self-Driving.” So just what kind of regulation could plausibly result at this stage to meaningfully alter the status quo is an open question.

Should Tesla rename Full Self-Driving or introduce any other changes to its marketing? Let us know in the comments below.


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