Steering clear of deception: Navigating the legality of marketing claims
Lessons on how discrepancies between an organisation's marketing approach, and the actual product, could potentially mislead consumers.

Tesla has become synonymous with the development and implementation of autonomous driving technology worldwide. Its vehicles are marketed as arriving with autopilot features and hardware that may one day be capable of full self-driving. However, earlier this year in the United States, Tesla was sued for misleading marketing practices for claims that it allegedly incorrectly characterised the autopilot and full self-driving capabilities of its vehicles. While Tesla is defending the claims, it raises the question of whether Tesla’s conduct in Australia might face similar issues. More broadly, it’s an interesting case study when marketing new products and crafting key promotional messages to understand your potential customers and the impact of qualifying disclaimers.
Tesla’s marketing and public statements
In the past, Tesla’s CEO, Elon Musk, has made numerous comments regarding the capabilities of Tesla’s autopilot features. Some of Mr Musk’s statements include:
- "I'm confident that in less than a year, you'll be able to go from highway on-ramp to highway exit without touching any controls”. – 2014, Tesla annual shareholder meeting
- “We’re now almost able to travel all the way from San Francisco to Seattle without the driver touching any controls at all” – 2015, Tesla press call
- “[Self-Driving is] probably better than a person right now” – 2016, Conference call with reporters
Likewise, in November 2016, Telsa’s autopilot page of its website claimed that,
“[a]ll Tesla vehicles produced in our factory, including Model 3, have the hardware needed for full self-driving capability at a safety level substantially greater than that of a human driver”.
Significantly, Tesla clarified that statement further down the web page by noting that these features were dependent upon “extensive software validation and regulatory approval, which may vary widely by jurisdiction”.
Recently, Tesla pulled back significantly from both Mr Musk’s earlier statements and its promotional claims concerning autopilot and its cars’ purported full self-driving capabilities. In particular, while noting that the autopilot feature makes its cars “safer and more convenient to drive”, it states that these features “require active driver supervision and do not make the vehicle autonomous”.
Why these statements might be considered misleading
Any assessment of the legality of Tesla’s marketing requires proper consideration of what autopilot and self-driving actually mean to consumers. Unfortunately, these terms can easily be misinterpreted depending on the context and audience.
- In the automotive industry, the Society of Automotive Engineers defines self-driving to mean a vehicle that falls within an automation scale from 0 to 5, where 0 is fully manual and 5 is fully autonomous. Conceptually, levels 0 to 2 require humans to monitor the driving environment, while levels between 3 to 5 require the car’s automated system to monitor the driving environment. Tesla’s vehicles currently sit on level 2 on the autonomous scale which means that vehicles can control both steering and speed but still require a human in the driver’s seat at all times to take control of the car.
- In contrast to this technical engineering definition, the average consumer would likely have a different understanding of the Society of Automotive Engineers automation scale. J.D. Power’s 2022 U.S. Mobility Confidence Index Study revealed that 65% of consumers are unable to accurately define fully automated, self-driving vehicles, with 56% classifying current driver-assist technologies as ‘self-driving’ systems.
- Finally, the ordinary definition of autopilot is “a device that keeps aircraft, spacecraft, and ships moving in a particular direction without human involvement,” and self-driving is “a vehicle that drives itself.” Both of these definitions give the impression that these vehicles' features are far more capable than those defined in the automation scale.
Assessing whether conduct is misleading or deceptive also requires the identification of a class of consumer at which such conduct is aimed. Tesla’s typical consumer will likely have a baseline understanding that current autonomous driving technologies are not fully self-sufficient and still require human oversight. However, the use of express statements (such as those made by Mr Musk and on Telsa’s website back in 2016) and implied representations (such as the connotations of the words autopilot and self-driving) may create an impression that Tesla vehicles are more advanced in their autonomous capabilities than is actually the case. Recent US research has found that self-driving cars are better at routine tasks but are five times more likely to be involved in an accident in low-light. Given these matters, even though Tesla has in recent years scaled back its earlier claims, it may be that its qualifications and disclaimers are not enough to ensure that its overall conduct meets Australian Consumer Law requirements.
Tesla's approach to marketing its autopilot system raises important questions within the framework of Australia’s consumer protection laws. While Tesla's vision of a fully autonomous driving future is certainly ambitious and forward-looking, the discrepancy between Tesla’s marketing approach and the actual existing features could potentially mislead consumers as to the capability of Tesla’s vehicles. If so, such marketing might interest the ACCC, given its enduring priority of protecting consumers from misinformation and serious harm.
Lessons for businesses
1. Be clear and precise: Ensure that all marketing claims are clear, precise, and accurately reflect the product's capabilities. Avoid using ambiguous or exaggerated language that could mislead consumers about what the product can do.
2. Substantiate claims: Be prepared to provide solid evidence it claims are challenged. This includes scientific studies, customer testimonials, and independent reviews.
3. Consider the audience: Tailor marketing messages to the intended audience, considering their likely level of knowledge and understanding. Avoid assuming that consumers will interpret technical terms correctly.
4. Regular review and compliance:
Regularly review marketing materials and statements for compliance with legal standards. Implement a compliance program to ensure all promotional content meets Australian Consumer Law requirements.
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