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Tesla CEO Elon Musk  (Source: Air & Space Smithsonian)
The NADA is launching a campaign against efforts to restrict the franchise dealer model

It looks as though the National Automobile Dealer Association (NADA) is getting a bit scared of the progress being Tesla Motors’ efforts to sell electric vehicles directly to consumers. Earlier this month, the New Jersey Assembly Consumer Affairs Committee voted 4-0 to allow Tesla to sell vehicles from [up to] four company-owned stores within the state.  Earlier this week, New Jersey’s General Assembly passed the bill to solidify those plans. The bill must now go to the state Senate, and if passed, will go before Governor Chris Christie to be signed into law.
 
In neighboring New York, Tesla also scored another victory this week when Governor Andrew Cuomo signed pro-Tesla legislation into law. This legislation not only allows Tesla to keep its five company-owned stores, but also allows for “additional Tesla retail locations [to] be established under a strengthened dealer franchise law.”
 
“New York’s franchised auto dealers and manufacturers as well as innovative companies like Tesla are critical to our state’s economy,” said Governor Cuomo. “This bill ensures that both sides will thrive and be able to grow the market for cutting edge zero emission vehicles.”


NY Governor Andrew M. Cuomo [Image Source: AP]
 
Following these Tesla victories, the NADA is fighting back to protect the franchise dealership model. The NADA has gone into damage control mode, launching a new initiative called “Get the Facts: The Benefits of Franchised Auto Dealers.”
 
The NADA has a full page of resources that show why franchised dealerships are beneficial to consumers and why evil company-owned stores are harmful to everyone.

This video posted on NADA website extols the virtues of the francised dealership model 

“New-car dealers provide the best and most efficient way to buy and sell cars for both consumers and manufacturers, despite the misinformation and misconceptions that have surfaced over the last several months,” said NADA President Peter Welch. “NADA’s efforts will set the record straight about the benefits of the dealer franchise network for consumers, manufacturers and local communities everywhere.”
 
The NADA might see Tesla as a tiny thorn in its side, but the real threat looms from the Alliance of Automobile Manufacturers. The alliance — which counts BMW, Chrysler, Ford, GM, Mercedes-Benz USA, Toyota, Toyota, Volkswagen Group, and Volvo as members – is also warming up to the idea that the franchise model is perhaps antiquated and ripe for change.
 
"It's understandable why Tesla or future competitors would want a simpler sales process. When we look at the big picture, we may be at a tipping point,” said Gloria Bergquist, a spokeswoman for the Alliance of Automobile Manufacturers in a statement to Automotive News. “If dealer groups continue their push for more onerous franchise laws, we will be forced to keep an open mind about how best to serve new-car buyers in the future."

Sources: Governor Cuomo's Office, NJ.com, Automotive News, NADA





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