I think if your assumption is that AI is deducing where it is with rational thoughts, you would be. In truth what probably happened is that the significant majority of digital images of the world had been scraped, labeled and used as training data.
Try it with your own photos from around the world. I used my own photos from Stockholm, San Francisco, Tvarožná, Saas-Fee, London, Bergen, Adelaide, Melbourne, Paris, and Sicily, and can confirm that it was within acceptable range for almost all of them (without EXIF data), and it absolutely nailed some of the more obvious spots.
they only posted one photo in the post, but going off of that it's still an easy match based on streetview imagery. furthermore, the AI just identified the license plate and got lucky that photographer lives in a populous area, making it more prominent in the training data and therefore more likely to be found (even though it was off by 200 miles on its first guess)
