Tesla Hit with Lawsuit in Australia Over Self-Driving and Phantom Braking Issues

Tesla is facing a class-action lawsuit in Australia over alleged misleading claims about its self-driving capabilities and hardware performance. Learn more about the legal case.

Tesla is once again facing a legal battle, this time in Australia. A new class-action lawsuit has been filed against the company, alleging misleading claims about the capabilities of its self-driving technology and vehicle hardware. At the heart of the lawsuit are Tesla’s Full Self-Driving (FSD) system and Hardware 3 computer, which, according to the plaintiffs, fail to meet the advertised standards.

The lawsuit, filed in the Federal Court of Australia, applies to owners of Tesla Model 3 and Model Y vehicles purchased or leased between May 2021 and February 2025. Drivers claim Tesla marketed its cars as fully autonomous when, in reality, they are not. Additionally, the complaint highlights the issue of "phantom braking"—unexpected slowdowns or sudden stops that users argue create dangerous driving conditions.

This is not the first time Tesla has faced legal challenges over its technology claims. In the U.S., similar lawsuits have emerged. In November 2024, a federal judge in Chicago ruled that Tesla must address part of a class-action lawsuit related to phantom braking issues. Earlier, in February 2025, a Florida appeals court ruled in favor of Tesla, limiting potential damages in a wrongful death case linked to Autopilot.

Another key issue in the Australian lawsuit is the discrepancy between Tesla’s advertised and actual driving range. This concern is not new—Tesla owners worldwide have reported that their cars fall short of the promised range on a single charge. In 2023, it was revealed that Tesla had even created a dedicated team to cancel service requests related to battery performance.

As regulatory pressure and consumer frustration mount, Tesla continues to refine its software, but the question of hardware upgrades remains unresolved. While owners of vehicles equipped with Hardware 2.5 were given the option to upgrade to Hardware 3, the company’s plans for future hardware updates remain unclear.

The lawsuit in Australia could become a crucial test for Tesla. If the case gains traction, it may trigger further investigations and regulatory scrutiny of self-driving technology not only in Australia but in other markets as well.

Source: electrek.co