A Beijing court held its first hearing last week in a lawsuit brought by 10 Tesla owners who say the company sold them a lie. The plaintiffs are seeking more than $583,000 in damages, arguing Tesla’s FSD system does not deliver the capabilities implied by the company’s marketing. What makes the timing especially awkward is that just a week before the hearing, Tesla quietly renamed its Full-Self Driving system “Tesla Assisted Driving” in the Chinese market, a smoking gun if there ever was one.
China’s FSD Problem Has Been Brewing Since 2019
The plaintiffs each paid around $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. When Tesla finally began rolling out its driving software in China, it only worked on vehicles with HW4.0 hardware. Owners with the older HW3.0 systems, which cover every car produced between 2019 and 2023, were excluded entirely.
Tesla is estimated to have over 1 million vehicles equipped with HW3 hardware in China. Under Chinese consumer protection law, the owners are seeking full refunds plus triple damages, the standard penalty for consumer fraud. Scale that math across a million-plus locked-out owners, and the potential exposure runs into the billions. Hundreds of additional owners are reportedly consulting lawyers about filing their own claims.
The rebrand makes things worse, not better. In China, Tesla now markets the system as “Tesla Assisted Driving”, chosen to align with how regulators classify Level 2 driver-assistance systems, where the driver is expected to remain attentive and in control at all times.
Tesla
Europe and Australia Are Watching, and Suing
China is not an outlier. In October 2025, thousands of Tesla owners joined a class-action lawsuit in Australia alleging Tesla misrepresented FSD and driver-assistance capabilities, directly triggered by Musk’s admission that HW3 vehicles would never achieve the promised autonomy. A Dutch Model 3 owner launched a collective claim site to bundle HW3 owners across the EU, with over 6,600 participants already. Tesla is facing up to $14.5 billion in potential lawsuits worldwide, many of them related to Autopilot and FSD. The stakes in this particular China lawsuit may be low in dollar terms, but in setting precedent, it is anything but.
