Tesla said on Wednesday that one of its cars had crashed in Beijing while in "autopilot" mode, with the driver contending sales staff sold the function as "self-driving".
Tesla said it had reviewed data to confirm the car was in autopilot mode, a system that takes control of steering and braking in certain conditions.
The company, which is investigating the crash in Beijing last week, also said it was the driver's responsibility to maintain control of the vehicle.
In this case, it said, the driver's hands were not detected on the steering wheel.
The crash, Tesla's first known such incident in China, comes months after a fatal accident in Florida, which turned up pressure on auto industry executives and regulators to tighten rules on automated driving technology.
Luo Zhen, a 33-year-old programmer at a technology company, was driving to work and engaged the autopilot function as he often does on Beijing's highways.
Luo, who filmed the incident with a dashboard camera, said his car hit a vehicle parked half off the road.
The accident sheared off the parked vehicle's side mirror and scraped both cars, but caused no injuries.
"The driver of the Tesla, whose hands were not detected on the steering wheel, did not steer to avoid the parked car and instead scraped against its side," a Tesla spokeswoman said in an e-mailed response to Reuters.
"As clearly communicated to the driver in the vehicle, autosteer is an assist feature that requires the driver to keep his hands on the steering wheel at all times..."
Luo, however, blamed the crash on a fault in the autopilot system and said Tesla's sales staff strongly promoted the system as "self-driving." "The impression they give everyone is that this is self-driving," he said.
