Tesla finds itself in a precarious situation as it faces potential expulsion from its largest market in the United States. The California Department of Motor Vehicles issued a stern warning on Tuesday, echoing the judgment of an administrative law judge. The issue at hand is Tesla’s marketing, which the DMV deems deceptive, particularly in its portrayal of the self-driving capabilities of its vehicles.

The core of the controversy lies in Tesla’s use of terms such as “Autopilot” and “Full Self-Driving” to describe its advanced driver assistance systems. According to the DMV, these terms are misleading and violate California state law. To address these concerns, the DMV has demanded that Tesla rectify its marketing strategies related to the term “Autopilot” within a 60-day period. Failure to comply could result in a 30-day suspension of Tesla’s license to sell cars in California.

Interestingly, while the DMV considered a more severe penalty, it opted not to suspend Tesla’s manufacturing license, a move that had been suggested by the judge. This decision avoids a potentially costly halt in operations at a time when the electric vehicle industry is grappling with waning demand, exacerbated by the phasing out of EV tax credits.

To adhere to the DMV’s requirements, Tesla might need to rebrand its driver assistance software. Currently, the company markets these systems under the names Autopilot and Full Self-Driving. However, unlike the fully autonomous technology used by companies like Waymo, Tesla’s systems still necessitate constant driver attention and intervention.

This decision from the DMV comes after it called upon an administrative judge to scrutinize Tesla’s marketing practices and evaluate the justification for suspending its licenses. The DMV has accused Tesla of making false and misleading statements for years, suggesting that its vehicles can operate independently, which is not the case. Tesla, on its part, disputes these allegations, maintaining that it has always been transparent about the necessity for drivers to remain engaged and attentive behind the wheel.