Tesla avoids suspension by California regulator after corrective marketing changes

Tesla TSLA.O will avoid a 30-day suspension of its dealer and manufacturer licenses in California after the U.S. electric vehicle maker stopped using the term "autopilot" in marketing of its vehicles in the state, a regulator said on Tuesday.

The reprieve from the California Department of Motor Vehicles (DMV) comes as Tesla and other EV makers grapple with a plunge in demand following the expiration of key tax credits that had boosted sales.

Tesla CEO Elon Musk has switched the company's focus toward robotaxis equipped with self-driving technology, as well as humanoid robots.

In 2022, the DMV accused Tesla of misleading consumers by using names "autopilot" and "Full Self-Driving" (FSD) for its advanced driver-assistance features.

The DMV narrowed its focus last December to the term "autopilot" as Tesla revised its use of the term "Full Self-Driving" to clarify that driver supervision is required.

The regulator had deferred an order to suspend Tesla sales in California, its biggest U.S. market, giving the EV maker additional time to address the allegations.

"Autopilot" enables Tesla vehicles to accelerate, brake and remain within their lanes on highways. "Full Self-Driving" allows vehicles to change lanes and respond to traffic signals on city streets.

-Natalia Bueno Rebolledo/Reuters