Tesla's 'Full Self-Driving' fraud lawsuit gets first hearing in China — 10 owners seek $583K | Electrek

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Tesla’s ‘Full Self-Driving’ fraud lawsuit gets first hearing in China — 10 owners seek $583K

Fred Lambert | May 30 2026 - 9:20 am PT

19 Comments

A Beijing court held its first hearing in a consumer fraud lawsuit against Tesla over its “Full Self-Driving” software, with 10 owners seeking more than 3.95 million yuan ($583,000) in damages.

The case, which we first covered when it was filed last September, has grown from 7 to 10 plaintiffs and marks China’s first collective legal challenge targeting Tesla’s FSD promises.

What the owners claim

According to a report from The Beijing News, the plaintiffs each paid 56,000 yuan (~$7,800) for Tesla’s FSD package between 2019 and 2021. They allege that Tesla sales staff and CEO Elon Musk assured them “full self-driving” capability was imminent and that the price would increase — motivating them to buy.

The reality turned out differently. When Tesla began rolling out its driving assistance software in China last this year, it only supported vehicles equipped with HW4.0 hardware. Owners with older HW3.0 vehicles, which includes all cars produced between 2019 and 2023, were excluded.<br>Advertisement - scroll for more content

The plaintiffs argue Tesla’s FSD system has not received regulatory approval in China, cannot perform the functions promoted in its marketing, and that the company concealed hardware limitations in order to sell vehicles.

Under China’s Consumer Rights Protection Law, the owners are seeking full refunds plus triple damages — the standard penalty for consumer fraud in the country.

Tesla disputed the allegations during the hearing, claiming some FSD functions are “fully operational” while others are “partially functional” or still under development.

Timing couldn’t be worse for Tesla

The hearing comes at a particularly awkward moment for Tesla’s China autonomy strategy. Just nine days ago, Tesla confirmed that FSD (Supervised) is now available in China. And just a week ago, the company renamed its system “Tesla Assisted Driving” in the Chinese market — a tacit admission that the “Full Self-Driving” branding was misleading.

The renaming is unlikely to help Tesla’s legal defense, since the plaintiffs purchased FSD under the original branding and were specifically told the system would achieve autonomous driving.

The lawsuit also adds to Tesla’s growing global legal exposure over its self-driving claims. Tesla is facing up to $14.5 billion in lawsuits worldwide, many of them related to Autopilot and FSD. In the US, a class action over misleading FSD claims is proceeding, and a Texas owner recently won a $10,000 judgment against Tesla for failing to deliver on FSD promises — with Tesla still fighting the ruling.

Tesla is estimated to have over 1 million vehicles equipped with the HW3 computer in China, meaning this case could set a precedent affecting a massive number of owners.

No ruling timeline was disclosed.

Electrek’s Take

Top comment by OlsonBW

Liked by 7 people

When I was looking for a new car and I was looking SERIOUSLY at the Model Y, Elon was telling us that our cars would be worth MANY TIMES MORE than when we bought it because of the future ability, which was supposed to be right around the corner, to join the Tesla taxi service where we could have people buy rides in our car while we weren't using it. That income was to INCREASE the value of our cars "many times over" and all I've seen is LACK of any such taxi service that I can add my car to, an FSD that isn't ANYWHERE close to being the door to door software that people were promised back with Hardware 2.0.

I have ZERO interest personally in having anyone I don't know riding in my car. But if I ever sell my car, it was supposed to be worth MANY TIMES OVER what I paid for it. And last time I checked, well I've already told you what I've checked and my car is worth LESS.

Elon said that all the things he promised, INCLUDING a FULL FSD client that would take us door to door wherever we needed to go within the range of our house and Tesla Superchargers.

Congrats to Tesla for shocking my wife and I last week when I told it to take us to a very big in the northwest store that has groceries and clothes to furniture to automotive and toys, basically most of what I need for my life.

What it doesn't have is charging stations for my Tesla Model Y. But the software not only took us to Fred Meyers and into the parking lot, but it actually found and parked in a parking space all on its own!

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I’ve been saying it for a long time: Tesla’s premature sales of autonomous driving features are a massive financial liability, and the bill is coming due around the world.

The core problem remains the same in every jurisdiction: Tesla sold a product...