Tesla’s goal to sell direct by any means necessary is continuing to succeed, most recently this past week in New Jersey, Ohio, and New York. Although Tesla likes to cast this battle as a free market issue, that is subject to one’s viewpoint. No matter where one stands on the issue, Tesla is making steady progress in its efforts, and this past few days has made some major progress in places that many thought were going to be problematic for the electric luxury car builder.
First up is New Jersey. In the Garden state Tesla fans felt as if the Republican Governor pulled a fast one on Tesla. Tesla had been given the green light to sell direct in a couple stores, but its third store’s paperwork got snagged in red tape. The Motor Vehicle Commission in New Jersey then held a meeting and ruled that Tesla would not be allowed to sell direct. The Teslerati had a full blown hissy fit. Blaming the Republican executive branch for laws written by the Democrat judicial branch, they directed most of their faux free market diatribes at Governor Christie.
Apparently this approach worked. Over the past couple of days New Jersey has decided to allow the automaker to continue selling in NJ until April 15th. Reading between the lines, this is to give the legislature time to re-write the rules with an exemption just for Tesla. There are currently two proposals in the legislature that would exempt Tesla. These exemptions always say something like “Any EV already being sold direct, starting with T.” All the other EV makers like Nissan are handcuffed by franchise agreements.
In nearby New York CNNMoney reports that as of Friday (March 28th 2014) all parties in the New York battle including the dealer associations, Tesla, and the state, have agreed to let Tesla keep selling in its existing stores. However, future new stores would need to be franchises (dealers). That gives Tesla time to change the laws and still keep selling direct. Friday was a banner day for Tesla. The same story played out in Ohio. Tesla gets to keep its two stores there and open a third. This means that NJ, GA, WA, NY, VA, and OH have all now given Tesla a temporary exemption from the laws that all the other automakers are stuck following. This is a huge free market victory, but just for Tesla.
We asked David Lo, editor at 4EVriders.org, what he thought of this progress by Tesla. He said "Tesla it will succeed eventually despite resistance to changing the sales/marketing/service model. We need sustainable transportation." Our opinion is that the auto dealers and their associations know they are on the wrong side of history and the wrong side of public opinion. Generally speaking, people are sick of the terrible experience they have had buying from dealers. If the dealers and their lobbyists are not careful, a single large judgment might be proposed by Tesla in federal court, or in a state court that would act as a national model. The auto dealers will not risk that happening. You never know who might be on the jury. There might be some people on it that have purchased an automobile from a dealer, and undercoating, and special Simonize paint sealer, or nitrogen for their tires...
Photos courtesy of the Tesla Public site and the author.