Maine is so much smaller than any other states in which I've lived that I've started writing to government officials about things I care about, including EVs. Surprisingly one gets real answers back. Here are two:
Dear Governor LePage, Senator Haskell, and Representative Russell,
At a time when Maine is working hard to attract businesses to the state, it is distressing that our laws bar some companies with innovative business models. Customers, not laws, should decide how they want to buy products and with whom they want to conduct business.
Tesla Motors, an auto manufacturer based in California, is one such company. By adopting a direct-to-consumer model, Tesla can spend enough time with customers to ensure they understand their innovative all-electric cars, and it can maintain a consistently high level of customer care across all of its stores and service centers globally. I have personally been a customer of the company since March 2010, and I have never been treated as well by any franchised car dealer. Tesla's cars are outstanding examples of American engineering, winning numerous industry awards and the highest rating ever given to a car by Consumers Report. As all-electric vehicles, Tesla's cars help to improve air quality and reduce reliance on imported fuels.
Notwithstanding the merits of the company, Maine law bars Tesla from opening a store here. In particular, Maine's automobile dealer licensing law (Title 29-A, Chapter 9) defines a "new vehicle dealer" so as to require that the dealer "has a franchise from a distributor or manufacturer." (Subchapter 1, Section 851.9). And only a "dealer" can apply for a license. (Subchapter 2, Section 901). So, no franchise, no license. This definition therefore excludes the possibility of an automobile manufacturer from selling cars directly to customers, which is the cornerstone of Tesla's retail strategy.
This restriction is nearly unique to the auto industry. There is no law, for example, prohibiting L.L. Bean from selling clothes and gear direct; indeed, the onlyplace to buy L.L. Bean products is from L.L. Bean. Competition from other clothiers and suppliers protects customers from monopoly pricing, and the desire to win repeat business ensures that L.L. Bean's customer care is second to none. This direct-to-consumers business model is what many customers have come to expect: Apple, Dell Computers, Kenmore appliances, ... the list goes on almost without limit. Why, then, prohibit direct-to-consumer sales of automobiles?
Restricting trade can be justified to protect of health and safety. For example, pharmacists must be licensed by the state to ensure they have proper training to dispense medicines. There is no colorable argument, however, that an auto manufacturer selling directly to a customer creates any health or safety issue, provided that the manufacturer is held to the same standards as any other licensed dealer. Auto dealerships have not been in the front ranks advocating to force auto manufacturers to address safety issues on their vehicles. Quite the opposite, it was only direct lawsuits by those killed by poor GM engineering that forced the massive safety recalls; dealers have been slow to install retrofits that could save lives.
Nor can this restriction on direct car sales be justified based on protecting consumers. Quite the opposite. Officials at the Federal Trade Commission have spoken out about the potentially harmful consequences of the dealers’ anti-competitive behavior, saying “competition ultimately provides the best protections for consumers.” Leading economists have also weighed in, saying dealer monopolies come “at the expense of consumers and innovative technologies.”
Maine can send an "open for business" message by striking this unreasonable restraint of commerce from our statutes. Existing franchisees will, of course, object, seeking to continue their monopoly on new car sales. These franchisees have some legitimate claim that they have invested over the years to build up not only their brand but the brand of the franchisor. In the case of a new automaker, like Tesla, that has no existing franchisees, this argument is moot. A carefully considered change to the definition of "new car dealer" (Title 29-A, Chapter 9, Section 851.9) could preserve the existing dealerships while opening the door to a new business model for new companies. In particular, this could be done by amending the definition to include at the end, the following:
", or a motor vehicle manufacturer that has no franchised dealers in the state prior to January 1, 2016."
I hope that you will consider this measure in the upcoming term. A change in law that is both pro-business and pro-consumer, and costs taxpayers nothing, is surely worthy of passage.
Sincerely,
Robert ...
-------------
from Anne
Dear Robert: Rep. Russell and I have both been looking into this issue and have been in communication. We have agreed that she will take the lead on this matter as there is no sense in both of us moving down parallel paths. I am sure she will be back to you with her follow up before the end of the year.
to me, Diane.Russell
Sen. Anne Haskell
