Tesla has said it will place restrictions on the autopilot mode of its Model S sedans via an over-the-air update.
The firm added the driverless functionality in October, but it was limited to highways and freeways at speeds over 18 mph where driving conditions are relatively predictable.
However, soon after its introduction, Model S owners posted videos online showing the new autopilot feature exhibiting dangerous behaviour.
One Miami driver said that the car drove at 75mph in a 60mph zone which resulted in a police stop and eventual speeding fine.
At the time, Elon Musk, chief executive of Tesla, said the new feature was still in development and warned drivers to keep hold of the steering wheel when the mode was engaged.
The firm is now updating the cars again so that the function is restricted on residential roads or roads without a centre divider and they will be unable to drive faster than a maximum of the speed limit plus five miles per hour.
While Tesla is one of the most prominent manufacturers of electric cars, it was also one of the first companies to offer a steering system that could be operated hands-free.
While experts believe this is a significant step towards full self-driving vehicles that are believed to become commercially available by 2020, Musk has greater ambitions.
Speaking to reporters, Musk said Tesla cars could be fully automated by 2018, "Ultimately you’ll be able to summon your car anywhere your car can get to you," he said.
"I think that within two years, you’ll be able to summon your car from across the country."
The recent update to the autopilot mode came with some enhancements as well as the additional restrictions.
The graphical user interface saw a number of visual updates and ‘Summon mode’ was installed, which allows the vehicles to park themselves.
Although the car can only drive straight in 'Summon mode', it should let drivers to fit into tighter parking spots without having to leave room to open the door, and the vehicle will automatically back out of the spot on the driver’s return.