South Korean antitrust watchdog is planning on fining Tesla over false advertising allegations. The 2.85 billion won ($2.2 billion) fine will further dent the company’s declining stock value.
The Korea Fair Trade Commission (KFTC) called out the American electric car manufacturer after falsely promoting and exaggerating the “driving ranges of its cars on a single charge, their fuel cost-effectiveness compared to gasoline, and its Superchargers’ performance.”
It flagged it as misleading advertising and exaggerated promotion of the vehicle’s capabilities.
According to KFTC’s statement on Tuesday, Tesla failed to disclose that the driving range of its vehicles drops by up to 50.5 percent in cold weather. This is not what was advertised on the local Korean website.
The regulator also stated that Tesla failed to disclose that the “charging performance varies greatly depending on the type of supercharger, external temperature and the state of charge of the battery.”
Fuel-saving estimates are also problematic.
Tesla also failed to disclose how the charging cost of an electric vehicle is affected by various factors, such as charging speed and the government's policy on price discounts, KFTC said in the same statement.
That’s not the end of woes for Tesla Korea, which still hasn’t made any official comments regarding the whole marketing fiasco. In addition to the fine, Tesla will likely have to pay an additional penalty of one million won for violations of the Electronic Commerce Act due to its lackluster cancellation policy.
The company seems to still be going down a thorny path it walked in 2022 when its shares plummeted 65% after successful 2020 and 2021.