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Tesla's ability to sell cars in California hangs in the balance after a weeklong 'high-stakes' court hearing

1. California DMV accuses Tesla of misleading advertising about Full Self-Driving. 2. DMV seeks to suspend Tesla's sales license for 30 days in California. 3. Previous sales slump exacerbated by recent national protests against Tesla. 4. Lawsuits and investigations pose ongoing legal challenges for Tesla's FSD technology. 5. No final ruling made yet; high-stakes legal implications for Tesla's business.

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FAQ

Why Very Bearish?

The California DMV’s lawsuit undermines consumer trust and potential sales. Historical precedents show legal troubles can significantly affect stock prices, as seen in Uber and Lyft’s regulatory battles.

How important is it?

The lawsuit's implications on Tesla's core sales operations in a key market make it highly significant. Legal challenges can disrupt business growth and investor confidence.

Why Short Term?

Immediate concerns surrounding Tesla's ability to sell cars in California could affect next quarter's sales. Prompt resolution of the lawsuit is crucial for mitigating further damage.

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