Tesla Complies with California’s Motor Vehicle Law, Avoiding 30-Day Sales Suspension
In Focus
- California’s motor vehicle regulator had accused Tesla of deceptive marketing
- The court agreed to the 30-day sales suspension recommended by the regulator
- Tesla discontinued the Autopilot system in January 2026
Tesla has avoided a 30-day suspension of its sales and manufacturing licenses in California. According to TechCrunch, the California Department of Motor Vehicles (DMV) has opted not to take the action after the EV maker stopped using the “Autopilot” term in its marketing campaigns in California. The decision about Tesla’s Autopilot suspension was issued on February 17, 2026.
California Sales to Continue Uninterrupted
The latest Autopilot legal update means Tesla sales in California will not be interrupted. It also means the state agency settles the case officially. The case has dragged for close to 3 years in California.
Tesla avoids the 30-day Autopilot ban comes weeks after the EV maker discontinued the system in the U.S. and Canada last month. This decision enabled it to comply with DMV demands and also allowed it to focus on increasing FSD adoption.
Last month, Tesla dropped the one-time payment for FSD and shifted to monthly subscriptions of $99 last month. While the company Tesla did not explain whether the shift applied to markets outside the U.S. However, the move was seen as a strategy for enhancing FSD adoption, which is one of the operational milestones in CEO Elon Musk’s $1 trillion pay package.
DMV Had Accused Tesla of Deceptive Marketing
The DMV had filed an accusation claiming that Tesla violated state law after it used deceptive marketing of its basic advanced driver assistance system, Autopilot. The state watchdog also claimed the company was misrepresenting its Full Self-Driving software in marketing materials.
According to the DMV, the terms ‘Autopilot’ and ‘Full-Self Driving’ distorted the capabilities of the advanced driver-assistance systems. Tesla had replaced the “Full Self-Driving Capability” with“Full Self-Driving (Supervised)” as a way of reflecting the limitations of the system and clarifying that drivers should remain attentive.
However, the EV maker continued using the term “Autopilot,” prompting the DMV in California to refer the matter to an administrative law judge at the California Office of Administrative Hearings.
State Regulator Allowed Tesla Time to Comply
The judge agreed with the DMV’s recommendation to suspend Tesla’s sales licenses in California for 30 days as a penalty in December 2025. Although the DMV accepted the ruling, it did not enforce it immediately. Instead, the state regulator allowed Tesla 60 days to comply.
“Since then, Tesla took corrective action and has stopped using the misleading term ‘Autopilot’ in the marketing of its electric vehicles in California. Tesla had previously modified its use of the term ‘Full Self-Driving’ to clarify that driver supervision is required. By taking this prescribed action, Tesla will avoid having its dealer and manufacturer licenses suspended in the state for 30 days by the DMV,” the DMV noted as cited by TechCrunch.
