Tesla discontinues Model S, X, shifts focus to Optimus factory
Tesla has announced plans to end production of the Model S and Model X and shift focus to its Optimus robot factory.
- Tesla is suing California after the state’s DMV found it engaged in false advertising of its Autopilot software.
- California regulators had threatened to suspend Tesla’s license to sell cars in the state for 30 days.
- Federal agencies, including NHTSA, are also investigating Tesla’s driver-assistance systems for safety risks and advertising.
Tesla is suing California over California regulators’ finding that the company falsely advertised its cars, including its once-popular Autopilot software.
The lawsuit, filed Feb. 13 in California Superior Court in Los Angeles County, challenges the California Department of Transportation’s December 2025 finding that Tesla violated the state’s Deceptive Advertising Act by portraying its cars equipped with Autopilot software as capable of fully autonomous driving.
The California DMV announced on February 17 that Tesla was following a directive to stop using the term “Autopilot” in marketing its vehicles in the state. The agency announced at the time that under the agency’s December 2025 ruling, the Silicon Valley electric car maker risks having its California dealer and manufacturer licenses, which are required to sell cars in the state, suspended for 30 days.
The California DMV said in a Feb. 17 statement that Tesla had already amended its use of the term “fully autonomous” to clarify that cars equipped with the system still require human driver supervision.
The agency did not respond to requests for comment on the Tesla lawsuit.
Tesla also did not respond to requests for comment about the lawsuit or the agency’s ruling.
Why was Tesla being pursued by advertising?
Tesla has long been criticized for promoting its “Autopilot” and “fully self-driving” software systems.
Federal and state regulators have accused the company of falsely advertising to consumers that its cars were capable of fully driving themselves.
The California DMV’s lawsuit against Tesla dates back to May 2021. Since 2016, the state has asked Tesla to stop using “Autopilot” in its advertising.
California DMV Director Steve Gordon said in a statement that the department is “pleased to have taken the necessary steps to ensure Tesla remains compliant with California consumer protections.”
The National Highway Traffic Safety Administration has also launched multiple investigations into the company’s driver-assistance software systems, including an ongoing investigation launched in October over allegations that Teslas in fully self-driving mode violated traffic safety laws. Previous federal investigations also investigated whether Tesla’s Autopilot system may have exacerbated behavioral safety risks for human drivers by compromising the effectiveness of driver supervision.
Other agencies, including the Department of Justice and the Securities and Exchange Commission, have also previously investigated Tesla’s advertising practices.
Michael Brooks, executive director of the Washington-based Center for Auto Safety, which advocates for stricter regulations, said in a statement provided to USA TODAY that California’s decision to backtrack on the idea of suspending Tesla’s license is “just the latest evidence that neither federal nor state authorities are able to act in a timely and effective manner” to ensure car buyers are not seduced by “deceptive auto marketing.”
What does Tesla say about its “Autopilot” and “Full Self-Driving” systems?
Tesla has decided to discontinue its Autopilot system, which has been at the center of federal and California investigations for years. The company announced in January that it was moving its Full Self-Drive software to a subscription model.
Critics of the company’s decision pointed out that CEO Elon Musk’s latest compensation package included an operational milestone of 10 million FSD subscriptions.
Tesla says in the instruction manual for Model 3 cars with Full Self-Driving that, “Like other Autopilot features, Full Self-Driving (with Supervision) requires an attentive driver and presents a series of progressive warnings that require driver action.”
Can Tesla cars be fully self-driving?
The National Highway Traffic Safety Administration classifies autonomous driving into six levels. According to the California Learning Resource Network, Tesla’s fully self-driving cars are generally considered capable of Level 2 autonomy, which NHTSA says means “the system provides continuous assistance with both acceleration/braking and steering while the driver remains fully engaged and alert.”
“Despite the name ‘Full Self-Driving,’ Tesla FSD is not a Level 5 self-driving system,” the website said in a February 2025 post. “At this time and as of this writing, it is generally considered to be a Level 2 system with advanced capabilities that approximate Level 3, but do not fully meet that requirement.”
Why is California important to Tesla?
California is the largest electric vehicle market in the United States.
More than 26% of new cars sold in California last year were electric models, according to the Automotive Innovation Coalition, which works with most major automakers in Washington. The next state with the highest total was Colorado, with electric vehicles accounting for 23.13% of new vehicle sales, according to the group.
Tesla sold 169,650 electric vehicles in California in 2025, according to the state Energy Commission. That compares with Cox Automotive’s U.S. sales of 589,160 EVs last year.
