- Tom LoSavio, 80, is the lead plaintiff in a California class action representing ~3,000 Tesla owners who paid thousands for Full Self-Driving upgrades on cars that are now too outdated to run the latest FSD software — with Tesla appealing the suit’s class-action certification.
- A Dutch Tesla owner paid €6,400 for FSD in 2019 and still can’t use it because Dutch regulators only approved the feature for the latest hardware generation — a situation echoed across Europe where older-hardware owners are locked out entirely.
- An Australian law firm has filed a separate federal class action accusing Tesla of selling vehicles “incapable of supporting fully autonomous or close to autonomous driving,” as the international backlash against Musk’s self-driving promises spreads.
- Wall Street analysts estimate millions of Teslas on the road carry the outdated “Hardware 3” chip — no longer capable of running Tesla’s most advanced FSD software — with Tesla having made no concrete moves to upgrade them since Musk acknowledged the problem on a January 2025 earnings call.
What Happened?
Since 2016, Tesla has marketed its vehicles with the promise that on-board hardware would eventually support full autonomous driving. Buyers who paid thousands for “lifetime” Full Self-Driving access — including $8,000 upfront in LoSavio’s case — believed they were investing in a capability that would be unlocked via software updates over time. Instead, Tesla has cycled through four hardware generations since then, each time leaving the previous generation behind. Owners who received complimentary upgrades to Hardware 3 found themselves stranded again in 2023 when Tesla debuted its Hardware 4 chip in new vehicles. The most recent major FSD update, released in late 2024, only ran on Hardware 4 — leaving millions of Hardware 3 owners with a frozen product. Musk has publicly acknowledged the problem and promised upgrades, but has taken no concrete steps since January 2025.
Why It Matters?
This is a direct legal and reputational challenge to the single most powerful narrative in Tesla’s stock story: that its existing fleet would become a robotaxi network worth trillions. If courts find that Tesla systematically misled buyers about FSD capabilities — or that its hardware promises were knowingly unachievable — it doesn’t just expose the company to damages. It undermines the foundational argument that every Tesla sold today is a future autonomous vehicle, the thesis that has sustained Tesla’s premium valuation even as its EV market share erodes. The international dimension makes the problem harder to contain. Class actions in multiple jurisdictions, an organized European campaign, and persistent investor questions on earnings calls mean Tesla can’t quietly settle its way out of this narrative.
What’s Next?
The immediate legal question is whether the Ninth Circuit upholds class-action status for LoSavio’s California suit — a ruling that will determine whether Tesla faces a coordinated claim from ~3,000 plaintiffs or must be sued individually. Meanwhile, Tesla’s Austin robotaxi launch and the upcoming Cybercab production rollout will be closely watched for any signs that Musk is delivering on the autonomy promise — or pushing the goalposts further out. For Hardware 3 owners globally, the central unanswered question remains: will Tesla ever upgrade their vehicles, and if so, when and at what cost?
Source: The Wall Street Journal
