Tesla Loses Out in New Jersey's Vote for Direct Auto Sales Ban
March 12, 2014 12:44 PM
Tesla will have to stop selling its cars directly in the state starting April 1
called New Jersey out
yesterday for introducing a new rule that would block the automaker's ability to sell electric vehicles directly to customers, but it didn't seem to do much good as the state went ahead and voted in favor of it.
, the New Jersey Motor Vehicle Commission voted in favor of the ban of direct auto sales in the state on Tuesday. This means that Tesla must stop selling its electric vehicles directly to customers in the state beginning on April 1, 2014.
Tesla already operates two stores in New Jersey, and had plans to open more before this new rule. It's possible that Tesla could use them as showrooms now, where customers can look at the Model S, but must go buy them from dealerships or online.
New Jersey is now the third state to ban Tesla's direct sales model. Arizona and Texas were the first two states to give Tesla the boot.
Tesla CEO Elon Musk
New Jersey Gov. Chris Christie’s administration proposed the new rule earlier this week, which requires a person to have a franchise agreement with an auto manufacturer in order to be granted a license to sell.
Following the announcement of that rule, Tesla
went to its website
to make its opposition known.
"Unfortunately, Monday we received news that Governor Christie’s administration has gone back on its word to delay a proposed anti-Tesla regulation so that the matter could be handled through a fair process in the Legislature," said Tesla in a statement. "The Administration has decided to go outside the legislative process by expediting a rule proposal that would completely change the law in New Jersey. This new rule, if adopted, would curtail Tesla’s sales operations and jeopardize our existing retail licenses in the state."
Tesla CEO Elon Musk has said in the past that he'd be willing to take the auto dealership battle to a federal level if needed.
"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997
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