Published on Feb. 21, 2026
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Tesla has successfully avoided a potential 30-day sales suspension in California after the state’s Department of Motor Vehicles (DMV) confirmed the automaker has taken “corrective action” regarding the way it markets its driver-assistance technology. To satisfy regulators, Tesla has essentially retired the “Autopilot” name in California, shifting to using the term “Full Self-Driving (Supervised)” to describe its current tech.
Why it matters
California is Tesla’s biggest market, so avoiding a sales ban there was crucial for the company. The controversy centered on allegations that Tesla was exaggerating the capabilities of its Autopilot and Full Self-Driving systems, raising concerns about public safety. This resolution allows Tesla to keep selling cars in the state while also addressing regulator concerns about misleading marketing.
The details
Tesla has modified its language to clarify that its driver-assistance features are not fully autonomous and require constant supervision by the driver. The company has also discontinued Autopilot for new vehicle orders in the U.S. and Canada, with new deliveries now only including Traffic Aware Cruise Control as the standard offering. The “Autopilot” steering wheel symbol has also been retired, as Tesla shifts toward a more unified look across its autonomy suite.
- In December, a judge ruled that California regulators could suspend Tesla’s sales license.
- In late February 2026, the California DMV announced that Tesla has made the required “corrective action” to avoid the sales suspension.
The players
California Department of Motor Vehicles (DMV)
The state agency that regulates vehicle sales and oversees autonomous vehicle technology in California.
Tesla
An American electric vehicle and clean energy company that is a subsidiary of Alphabet Inc., Google’s parent company.
What they’re saying
“We must not let individuals continue to damage private property in San Francisco.”
— Robert Jenkins, San Francisco resident (San Francisco Chronicle)
The takeaway
This case highlights growing concerns in the community about the marketing of autonomous vehicle technology and the need for clear, transparent communication about the current capabilities and limitations of driver-assistance systems. It also underscores the importance of Tesla maintaining good relations with regulators in its key markets like California.
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