Tesla Faces First China Class-Action Trial Over FSD Marketing Claims (TSLA)

Tesla (TSLA) is battling a landmark consumer fraud lawsuit in China as a Beijing court opened the first hearing in a collective case filed by 10 vehicle owners. The plaintiffs seek more than 3.95 million yuan ($540,000) in total refunds and damages, alleging the automaker falsely advertised its Full Self-Driving (FSD) capability as fully autonomous despite lacking Chinese regulatory approval. The suit, first filed in August 2025 and delayed by a Tesla jurisdictional challenge, contends that owners paid 56,000 to 64,000 yuan for a promised feature that remains inoperable as marketed. Tesla argued in court that FSD functions are “already realized” or partially deployed, with further development underway. Nine plaintiffs demand triple damages for the FSD option alone, while one seeks the same remedy for the entire vehicle purchase. Tesla quietly rebranded the system from “FSD” to “Assisted Driving” on its Chinese website in May 2026, yet kept its price at 64,000 yuan. A supervised version launched in China on May 21, 2026, still operates at Level 2, requiring constant driver oversight. The case follows a similar U.S. class-action ruling in California.