Tesla Petitions White House for Help with Direct Sales
With some states either banning or considering a ban on vehicles being sold directly by an automaker, Tesla Motors is petitioning the White House for help in swaying opinion. The electric car company has launched an online petition it plans to send to the White House by the end of next week.
The goal: Acquire 100,000 signatures from those who think states should allow automakers to sell vehicles directly to buyers and not be forced to go through a third-party dealer.
As of early afternoon Wednesday, more than 15,300 people have signed the online petition.
Fighting for direct sales in Texas
Right now Texas is the only state that does not allow automakers to conduct test drives or deliver vehicles to buyers. That means Tesla can, and does, show its Model S sedan in galleries in Texas but it cannot sell cars in that state.
The law in Texas requires all new vehicles be sold through a licensed, third-party dealer. For auto dealers there, the law protects them from having their business undercut by manufacturers such as Ford, Toyota or any other automaker that might decide they should cut out the middle man and sell directly to consumers.
Tesla however, does not have any third party dealerships. CEO Elon Musk has long said that if Tesla doesn't have any dealers right now, nobody will be hurt by the company selling cars directly to buyers.
Both sides make strong, legitimate arguments.
Auto dealers who are buying cars and trucks from automakers and then turning around and selling those vehicles to the public would be hurt if the automakers they buy from were allowed to simply sell directly. It's the reason state auto franchise laws are as strong as they are.
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On the other hand, Musk makes a compelling point when he says scores of other companies in other industries are allowed to sell their products directly to the public, so why shouldn't an automaker?
Will White House Support Sway Opinion?
Even if Tesla's petition to the White House convinces the Obama administration to publicly endorse direct sales of cars and trucks, it may not make much difference with state lawmakers. Auto dealers are among the biggest financial supporters of state legislators. It's the reason auto dealer lobbyists are among the most influential in state capitals around the country. They have a powerful argument to keep lawmakers in their camp: local auto dealerships are often among the biggest generators of tax revenue. For many legislators, the message is clear: protect the local auto dealers, and you protect the economy in your district.
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A groundswell of public clamoring for direct sales of Tesla models might change that equation in some state capitals. That is unlikely to happen anytime soon, even if the president says direct sales of cars make sense for consumers.
So for Tesla, the battle to change the law in Texas is likely to be a long slog.
(Read More: 'Most American' Automaker Is American Again).
One piece of good news for Tesla in its fight to add more direct-sale stores did come this week in the state of New Hampshire. On Tuesday, the governor of the Granite State signed a bill that has a specific provision allowing the direct sale of vehicles.
Tesla currently has no stores in New Hampshire.
(This story was corrected to state that Texas is the only state that does not allow automakers to conduct test drives or deliver vehicles to buyers.)
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