
High-stakes Miami trial puts Tesla's safety claims under scrutiny
The incident occurred near Key West, Florida, when a Tesla Model S, traveling nearly 70 mph, ran through flashing red lights, a stop sign, and a T-intersection before crashing into a parked Chevrolet Tahoe.
The collision killed Naibel Benavides Leon, who had been stargazing nearby, and seriously injured her boyfriend, Dillon Angulo. She was thrown 75 feet into a wooded area.
The plaintiffs argue that Tesla's driver-assistance feature, Autopilot, should have recognized the vehicle ahead and either warned the driver or slowed down. They claim Tesla's system failed to do so, despite detecting the Tahoe.
According to the lawsuit, the driver, George McGee, relied on Autopilot and was distracted, reaching for a dropped phone when the car crashed. McGee was sued separately, and that case has been settled.
Tesla, however, rejects any blame. In a statement, the company said, "The evidence clearly shows that this crash had nothing to do with Tesla's Autopilot technology. Instead, like so many unfortunate accidents since cellphones were invented, this was caused by a distracted driver."
Tesla also emphasized that its user manuals instruct drivers to remain alert and ready to take control at all times, noting that its vehicles are not fully autonomous.
What makes this case particularly significant is that U.S. District Judge Beth Bloom has allowed the plaintiffs to seek punitive damages, a rare development in lawsuits against Tesla. In her ruling last month, she dismissed claims of manufacturing defects and negligent misrepresentation but allowed other liability claims to move forward.
"A reasonable jury could find that Tesla acted in reckless disregard of human life for the sake of developing their product and maximizing profit," Judge Bloom wrote.
The lawsuit contends that Tesla should have restricted the use of Autopilot to major roads for which it was designed, preventing drivers from activating it on smaller, rural roads like the one where the crash occurred. The plaintiffs cite data and video evidence showing the system detected the Tahoe but failed to act appropriately.
Tesla has since updated its Autopilot and Full Self-Driving systems, but concerns remain. In 2023, the company recalled 2.3 million vehicles after federal safety regulators found Autopilot did not do enough to ensure driver attention. Regulators later opened an investigation into whether Tesla had truly addressed the issue.
Despite ongoing scrutiny, Elon Musk continues to tout the capabilities of Tesla's "Full Self-Driving" technology, which he claims allows vehicles to operate independently. Federal officials have cautioned that such claims can mislead drivers into overreliance, potentially leading to crashes. The Full Self-Driving system has been linked to at least three fatal accidents and is under investigation for poor performance in conditions like sun glare and fog.
Tesla is pushing forward with plans to deploy a fleet of driverless robotaxis in the U.S. by the end of next year. Early test runs in Austin, Texas, have been largely successful, though isolated incidents—such as a car veering into the wrong lane—highlight persistent challenges.
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Toronto Sun
an hour ago
- Toronto Sun
Tesla profit plunges in latest quarter as Musk's turn to politics repels buyers
Published Jul 23, 2025 • 4 minute read FILE - A Tesla level three Electric vehicle charger is visible, Feb. 2, 2024, in Kennesaw, Ga., near Atlanta. Photo by Mike Stewart / AP NEW YORK — The fallout from Elon Musk's plunge into politics a year ago is still hammering his Tesla business as both sales and profits dropped sharply again in the latest quarter. This advertisement has not loaded yet, but your article continues below. THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. SUBSCRIBE TO UNLOCK MORE ARTICLES Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. REGISTER / SIGN IN TO UNLOCK MORE ARTICLES Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account. Share your thoughts and join the conversation in the comments. Enjoy additional articles per month. Get email updates from your favourite authors. THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK. Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account Share your thoughts and join the conversation in the comments Enjoy additional articles per month Get email updates from your favourite authors Don't have an account? Create Account The car company that has faced boycotts for months said Wednesday that revenue dropped 12% and profits slumped 16% in the three months through June as buyers continued to stay away. 'The perception of Elon Musk, its chief executive, has rubbed the sheen right out of what once was a darling and soaring automotive brand,' wrote Forrester analyst Dipanjan Chatterjee in an email. Tesla is 'a toxic brand that is inseparable from its leader.' Quarterly profits at the electric vehicle, battery and robotics company fell to $1.17 billion, or 33 cents a share, from $1.4 billion, or 40 cents a share. That was the third quarter in a row that profit dropped. On an adjusted basis, the company said it earned 40 cents a share, matching Wall Street estimates. Your noon-hour look at what's happening in Toronto and beyond. By signing up you consent to receive the above newsletter from Postmedia Network Inc. Please try again This advertisement has not loaded yet, but your article continues below. Revenue fell from $25.5 billion to $22.5 billion in the April through June period, slightly above Wall Street's forecast. Tesla shares fell 3% in after-hours trading. Read More Musk spent the company's earnings conference call talking less about car sales and more about robotaxis, automated driving software and robotics, which he says is the future of the company. But those businesses are yet to take off, and the gap between promise and profit was apparent in the second quarter. 'It appears management's focus will now shift to robotaxis and away from deliveries growth,' said Morningstar analyst Seth Goldstein, referring to car sales. This advertisement has not loaded yet, but your article continues below. A big challenge is that potential buyers not just in the U.S. but Europe are still balking at buying Teslas. Musk alienated many in the market for cars in Great Britain, France, Germany and elsewhere by embracing far-right candidates for office on the continent. And rival electric vehicle makers such as China's BYD and Germany's Volkswagen have pounced on the weakness, stealing market share. Tesla began a rollout of its paid pickup robotaxi service in Austin, Texas, and hopes to introduce the driverless cabs in several other cities soon. Musk has said he expects to have hundreds of thousands of the cabs on U.S. roads by the end of next year. In the post-earnings call, Musk said the service will be available to probably 'half of the population of the U.S. by the end of the year — that's at least our goal, subject to regulatory approvals. This advertisement has not loaded yet, but your article continues below. 'We are being very cautious. We don't want to take any chances.' The test run in Austin has mostly gone off without a hitch, though there have been a few alarming incidents, such as when a robotaxi went down a lane meant for opposing traffic. With autonomous taxis, though, the billionaire who upended the space race and the EV manufacturing faces tough competition. The dominant provider now, Waymo, is already in several cities and recently logged 10 million paid trips. RECOMMENDED VIDEO Meanwhile other threats loom. The new federal budget just passed by Congress eliminates a credit worth as much as $7,500 for buying an electric car. It also wipes out penalties for car makers to exceeding carbon emission standards. That threatens Tesla's business of selling its 'carbon credits' to traditional car companies that regularly fall short of emission standards. This advertisement has not loaded yet, but your article continues below. Tesla generated $439 million from credit sales, down sharply from $890 million a year ago. 'We're in this weird transition period where we'll lose a lot of incentives in the U.S.,' Musk said, predicting several rough months possibly through June 2026. He added, though, 'Once you get to autonomy at scale in the second half of next year, certainly by the end of next year, I would be surprised if Tesla's economics are not very compelling.' One way to boost sales that Musk mentioned while waiting for that future: A cheaper model. The company now is planning to introduce that to the market in the last three months of the year. Tesla had previously said that was going to happen by June this year. Musk also said he expected regulatory approval to introduce its so-called Full Self-Driving software in some parts of Europe by the end of the year. Musk had previously expected that to happen by March of this year. The feature, which is available in the U.S., is a misnomer because it is only a driver assistance feature. This advertisement has not loaded yet, but your article continues below. In the robot business, Musk said he expects explosive growth as Tesla ramps up production of its humanoid Optimus helpers to 100,000 a month in five years. 'We'll go from a world where robots are rare to where they're so common that you don't even look up,' he said. Asked about whether he would want more than his current 13% stake in Tesla to keep control, Musk said he did want more but not too much. 'I think my control over Tesla should be enough to ensure that it goes in a good direction,' he said, 'but not so much control that I can't be thrown out if I go crazy.' Gross margins for the quarter, a measure of earnings for each dollar of revenue, fell to 17.2% from 18% a year earlier. A highlight from the quarter was from something far removed from cars and robots: The company's investment in bitcoin. That bet generated a $284-million paper gain, compared with a loss the previous quarter. 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Globe and Mail
2 hours ago
- Globe and Mail
Tesla likely to face ‘a few rough quarters' from end of U.S. EV support, Musk says
Tesla Inc. TSLA-Q chief executive Elon Musk said on Wednesday that U.S. government cuts in support for electric vehicle makers could lead to a 'few rough quarters' for the company before a wave of revenue from self-driving software and services begins late next year. Shares fell nearly 5 per cent after Musk responded on a quarterly results conference call to questions about new U.S. government policies under President Donald Trump. Musk's electric-vehicle maker posted the worst quarterly sales decline in more than a decade and profit that missed Wall Street targets, but its profit margin on making cars was better than many feared. Musk is pursuing autonomous driving to power privately owned vehicles as well as robotaxis that it plans to put into production next year. In the meantime, it is working on a new, cheaper car, though chief financial officer Vaibhav Taneja said that production would ramp up next quarter, slower than initially expected. It produced some initial units by the end of June. The company did not provide an update on its full-year deliveries forecast, citing the economy and timing of the new car rollout. 'Tesla's disappointing results aren't surprising given the rocky road it's travelled recently,' said eMarketer analyst Jacob Bourne. 'A truly affordable model will hit the bullseye in terms of boosting sales if Tesla can effectively position it right without detracting from its higher-priced models.' The second straight quarterly revenue drop, with a 12-per-cent fall, comes despite the launch of a refreshed version of its best-selling Model Y SUV that investors had hoped would help revive demand. A 51-per-cent dive in sales of automotive regulatory credits, which other automakers who have difficulty complying with government emissions rules buy from Tesla, also hurt revenue and profit. Revenue fell to US$22.5-billion for the April-June quarter from US$25.50-billion a year earlier, slightly behind analyst targets compiled by LSEG. Adjusted profit per share of 40 cents lagged the Wall Street consensus. A key driver of Tesla's profit is disappearing fast The automotive gross margin, which excludes regulatory credits, was 14.96%, above Wall Street estimates, helped in part by lower cost per vehicle. Pricing and margins are important as Tesla wrestles with demand and faces falling government support. Tesla global deliveries dropped 13.5 per cent in the second quarter, and the U.S. government later this year is cutting US$7,500 tax credits for EV buyers. 'We probably could have a few rough quarters,' Musk said, when asked about the credits. 'I'm not saying we will, but we could – you know, Q4, Q1, maybe Q2, but once you get to autonomy at scale in the second half of next year, certainly by the end of next year, I think I'd be surprised if Tesla's economics are not very compelling.' Tesla had said in April it would start producing the more affordable model by the end of the first half and sources had told Reuters the vehicle, a stripped-down version of its Model Y SUV, would be delayed by at least months. Tesla on Wednesday did not disclose any details of the model, how many units it had made, or how it would be priced. Musk responded to a question of what the vehicle would look like by saying, 'It's just a Model Y,' joking that he 'let the cat out of the bag there.' Tesla's lineup is relatively old, despite a recent refresh of the flagship Model Y, and it faces rising competition from cheaper EVs, especially in China, and a persistent backlash against Musk's far-right political views. The company also said it continued to expect volume production of its custom-built robotaxi – called the Cybercab – and Semi Truck in 2026. Much of the company's trillion-dollar valuation hangs on its bet on its robotaxi service – a small trial of which was started in Austin, Texas, last month with about a dozen Model Y SUVs – and on its development of humanoid robots. 'Autonomy is the story,' Musk said on the conference call, describing plans to roll out autonomous ride hailing to about half of the U.S. population by the end of this year. Tesla is looking for robotaxi regulatory approval in the San Francisco Bay Area, Nevada, Arizona, Florida and other places, he said, and the company is close to getting regulatory approval for supervised Full Self-Driving driver assistance software in the Netherlands. The robotaxi business was likely to have a material impact on financials around the end of next year, Musk said. Investors are concerned about whether Musk will be able to devote enough time and attention to Tesla after he locked horns with Trump by forming a new political party this month. He had promised weeks earlier that he would cut back on government work and focus on his companies. A series of high-profile executive exits, including a longtime Musk confidant who oversaw sales and manufacturing in North America and Europe, is also adding to the concerns.


Globe and Mail
6 hours ago
- Globe and Mail
Tesla Releases Second Quarter 2025 Financial Results
Tesla has released its financial results for the second quarter of 2025 by posting an update on its Investor Relations website. Please visit to view the update. As previously announced, Tesla management will host a live question and answer (Q&A) webcast at 4:30 p.m. Central Time (5:30 p.m. Eastern Time) to discuss the results and outlook. What: Tesla Second Quarter 2025 Financial Results Q&A Webcast When: Wednesday, July 23, 2025 Time: 4:30 p.m. Central Time / 5:30 p.m. Eastern Time Q2 2025 Update: Webcast: (live and replay) The webcast will be archived on the company's website following the call.