Tesla Can Use ‘Autonomous Driving’ and ‘Autopilot’ in Germany

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Tesla($NASDAQ:TSLA)’s driver assistance technology, which includes features like autonomous driving and autopilot, will be allowed to be advertised as such in Germany, according to German industry publication Teslamag. This is a reversal of a previous ruling that had prohibited Tesla from using the phrases, on the basis of false advertising. A 2020 court ruling in Munich had characterized the moniker as misleading, but this decision was later overruled by a higher court in the city in late 2021. It’s not yet clear how this will affect Tesla’s market and earnings in the long term, but it’s certainly a positive development for the company. Allowing Tesla to use these phrases should help to clear up any confusion about the capabilities of the technology, and could help to boost sales of Tesla vehicles in Germany.

Market Reaction

Tesla shares dipped on Tuesday after the electric carmaker said it would not be able to use the terms “autonomous driving” and “autopilot” in Germany. Tesla has been using the terms to describe its driver-assistance features, but German regulators said the terms are misleading and could give drivers a false sense of security. Tesla said it will comply with the regulators’ request and use other terms instead.

VI Analysis

-Tesla’s financial and business fundamentals point to long-term potential risks associated with the company. -The VI app’s Risk Rating for Tesla is high, indicating potential risks in both financial and business aspects of the company. -Some of the areas of potential risk for Tesla include its high debt levels, business model dependent on government subsidies, and history of production delays.

Summary

This is because investors may be worried that the company is over-relying on these features and that they may not be as effective as advertised.