New York State auto dealers are backing a pair of new bills that could prevent Tesla Motors (or any car manufacturer for that matter) from selling vehicles directly to consumers. The opposing legislature (bills A.7844A and S.5725A) would also make it illegal for the California-based electric car company to renew licenses for its three stores currently operating within the state. In a fight to protect their turf, the auto dealers are arguing that they’re only supporting laws put into place to protect consumer interest, and that Tesla is no exception… they must play by the rules. Tesla currently allows customers to test drive their cars at company-owned and operated showrooms in Long Island, Manhattan and Westchester before buying vehicles online directly from Tesla at a set price.
New York isn’t the first state to bump heads with Tesla Motors. Auto dealers in North Carolina, Texas and Virginia aren’t too keen on the revenue they lose by not being able to retail the new car either. In a unanimously approved measure by the Senate, North Carolina successfully blocked Tesla from selling its cars online, which was the only way people in the state could purchase Tesla vehicles.
These law makers and auto dealers are afraid of the impact Tesla’s model will have on the future of independently-owned dealerships, and with good reason. If other manufacturers follow Tesla’s direct-to-consumer lead and decide to cut out the middleman, non-company owned dealerships could become obsolete.
The opposing legislation—also supported by the Alliance of Automotive Manufacturers, the Global Alliance of Manufacturers and the New York State Dealer Associations—has been set aside in the New York State assembly, which doesn’t meet again until January.
Tesla Motors issued the following statement last Friday in response to the proposed bill:
“From the beginning, Tesla’s goal has been to catalyze the market for electric vehicles and selling through intermediaries at this stage of the company will not work. For Auto Dealer Associations to claim that restricting competition is in the best interests of the public is wrong and defies obvious common sense. If we are kept out of New York, it forestalls progress and defeats innovation.
Tesla has created jobs in New York at both its stores and service centers and the sales of its vehicles go into supporting the local economy. Tesla remains committed to bringing electric vehicle technology and its customer focused sales and ownership experience to New York consumers, while complying with all local and state laws.”
Via Digital Trends