Tag Archives: franchise laws

Why States Are Lining Up To Block Tesla

By Micheline Maynard

Consumers and investors are fascinated by Tesla Motors. The Tesla Model S electric car has won rave reviews from publications such as Consumer Reports, while shareholders are making a killing on Tesla stock.

The Tesla Model S

The Tesla Model S

So, why would any state want to block Tesla from doing business?

Yesterday, New Jersey officials affirmed the state’s law that allows only franchised auto dealers to sell vehicles. That essentially blocks Tesla, which sells its vehicles directly to consumers. The carmaker is expected to close its operations in New Jersey by April 1.

New Jersey joins Texas and Arizona in specifically blocking companies that sell directly, and since there’s only one out that, that means Tesla isn’t welcome in those three places. Other states have rebuffed Tesla’s efforts to open showrooms and service cars.

The reason is that car dealers are one of the strongest lobbies in the country, and they’re determined to protect their turf. Continue reading

Comments Off on Why States Are Lining Up To Block Tesla

Filed under cars, laws