Tesla Ordered to Pay Millions After Fatal Autopilot Crash

Tesla has been ordered to pay approximately US$243m in damages after a Florida jury found the company's Autopilot driver-assistance software to be defective in a fatal crash in 2019.

The case centred on George McGee, who was driving a Tesla Model S with Autopilot mode engaged — a software advertised as capable of auto-steering, auto-stopping and recognising obstacles.

While driving McGee allegedly leaned forward to pick something up from his footwell. With his eyes off the road, his car failed to detect a parked Chevrolet Tahoe at an intersection, and he did not brake or steer away.

The Tesla then collided with a couple standing by the parked car. Naibel Benavides Leon was killed in the crash, while her partner Dillon Angulo suffered major injuries.

Since the incident, Tesla has maintained that the driver was solely responsible for the accident. The EV manufacturer has stated that it plans to appeal the decision of the Florida jury.

Despite McGee admitting fault, the jury determined that Tesla's Autopilot system contained a defect and held the company partially liable for the incident.

Tesla argues that the self-driving functions of the car in question should only have been undertaken under full supervision.

Critics believe that, should Tesla successfully appeal the verdict, the future of autonomous vehicles will be thrown into question.

“The fantasy that automated longitudinal and lateral vehicle control equates to ‘self-driving’ is shattered; that the driver alone bears culpability for activating such software and the OEM is blameless,” says Colin Barnden, Principal Analyst at Semicast Research.

“The responsibility genie is now well and truly out the bottle.”

Tesla’s autonomous vehicles

The verdict arrives at a particularly challenging time for Tesla, with CEO Elon Musk looking for the approval of regulators so he can expand the company's robotaxi services across the US.

"The public perception of this verdict or things like this are going to fuel pressure on regulators to say, 'We just can't let this stuff be launched without a lot more due diligence'," says Mike Nelson, Founder of Nelson Law and an expert on legal issues in the mobility sector.

Tesla is now facing the prospect of convincing state regulators that its autonomous vehicles are road-ready, with applications currently pending in California, Nevada, Arizona and Florida.

Moreover, Musk has set an ambitious target of making fully self-driving (FSD) robotaxis available to half the US population by year-end, a timeline that legal experts suggest may now be very difficult to achieve.

"The timing for Tesla in light of the FSD rollouts and robotaxis is awful," says Aaron Davis, Co-Managing Partner at law firm Davis Goldman.

"Now there's essentially an opinion that some aspect of Tesla's business is not safe and maybe the safety that the company advertises isn't what it's cracked up to be."

What does this mean for Tesla going forward?

The expansion of driverless vehicles is of huge importance to Elon Musk, and it is an area where Tesla has lost a considerable amount of ground to competitors in recent years.

Since demand for its existing line-up of EVs has cooled globally, it has become of even greater significance to the business.

Much of Tesla's trillion-dollar market valuation depends on Musk's investments in robotics and AI technologies, so success is imperative.

After years of missed deadlines, Musk launched a limited robotaxi trial in June using approximately a dozen Model Y crossover SUVs in Austin, Texas.

Currently, each vehicle operates under the supervision of a human safety monitor positioned in the front passenger seat.

With the verdict of the case from 2019 now official, the progression of the vehicles to fully autonomy may now be in question.

Will Tesla ever launch fully driverless cars?

Analysts at Piper Sandler suggested the case may have limited direct implications for Tesla's FSD rollout, citing improvements made to the software since 2019.

However, the verdict follows years of federal investigations and recalls related to collisions involving Tesla's autonomous vehicle technology.

"It's going to take time to get regulators to move forward and time being more than the end of the year," says Gene Munster, Managing Partner at Deepwater Asset Management, a Tesla investor.

"From an image standpoint, it's a black eye."

Tesla has historically either won Autopilot-related litigation or reached out-of-court settlements with plaintiffs, making the Florida verdict particularly significant as several similar cases remain pending, according to Bloomberg.

Other people see the case as a precedent setter.

“As the AI expert on this case, I am glad to see this outcome. This verdict is not only a win for the victims but all of automotive safety,” says Missy Cummings, Professor of Robotics & AI at George Mason University.

“My heart goes out to Naibel Benavides’s family — no amount of money can ever bring her back but they can be assured their legal fight will save other lives.”