Wiki New Bills Introduced to End Bans on Tesla’s Direct-Sales Model

As new legislative sessions begin to ramp up in states across the country, Tesla is pushing to make its direct-sales business model legal in states it’s still restricted.

There are seven states that currently ban Tesla’s business model or restrict its number of stores and service centers that could soon change their laws.

TMC Member Pluto went through all the states where Tesla has restrictions and the and found the following bills introduced:



Connecticut – HB 5285

Nebraska – LB 51

New Mexico – SB 243

Oklahoma – SB 790

South Carolina – S 379

West Virginia – HB 2219



Pluto noted: “Many states seemed to not have started their legislative sessions or introduced all their bills yet so I’ll have to check for more later. Interestingly, Texas appears to be almost done introducing bills and I found nothing there.”

 

[OlderThanDirt]

The dust hasn’t settled on this legislation yet. Undoubtedly there will be some line item vetos if not a veto of the entire bill.

Wisconsinites need to reach out to the governor and urge him to keep the Tesla provision in the bill.

There are some owners who believe it should be vetoed entirely. Some don’t like how the Tesla provision got in the bill. While the bill is less than ideal they do not realize how incredibly difficult it will be pass this as standalone legislation. Believe me we’ve been trying....

This is politics ........ It’s a dirty business anyway you slice it.

 

[RobStark]

Wisconsin Gov can veto individual spending items.

The Tesla provision is not a spending item.

He can veto that too independently of the entire bill?

 

[OlderThanDirt]

The Wisconsin Tesla direct sales provision has been vetoed by the governor.....

From the Veto Message:

73. Direct Sale of Motor Vehicles from Manufacturer
Sections 1826g, 1826m and 1826s

This provision allows for the sale of motor vehicles directly by a dealership owned by a
manufacturer if that manufacturer only makes electric powered cars.

I am vetoing this provision as I object to significant changes to existing motor vehicle
dealership law and the consumer protections they provide to Wisconsin occurring late in the
state budget process and without the opportunity for adequate public input and debate.

 

[EinSV]

I just don't have any information on these (yet). I focused on states where I did find Tesla challenged/was challenged or have stores/service centers/galleries in. Basically I'll only include states that I have sources for.

I found the same thing too. It was actually not that hard to find honestly, maybe I'll work on some of the white states. And it looks like this law originated in 1953 (though it's hard to know for sure. I know it's prior to 1999 at least.

This is because Tesla has been grandfathered in to be the only automaker able to have certain rules for them. For other automakers, the orange/red color applies. I tried distinguishing this by specifying "Tesla" for blue and yellow, and "Automakers" in general for orange and red. When a state has only one color, then you can assume that the same rules apply to all automakers in the state.

I also explain each state's status in the "Latest Updates" section. Maybe I can change the legend to add in a "T" logo when the rules are different for Tesla. Then in Washington for example, there would be a blue "T" surrounded by an orange background. Ideas?

This map is great -- thanks for keeping it updated. I have one suggestion that might make it a little more user friendly and easier to take in at a glance. Since it is a map showing Tesla's direct sales, the colors on the map should match Tesla's sales/service status, not the status of the direct sales law that Tesla may be exempt from. If you wanted, you could then use the Tesla logo and leaf to indicate states where Tesla has an exemption of some sort. So Washington would be blue with a Tesla logo, Utah would be blue with a leaf, and Ohio would be yellow with a logo. You could either color code the logo, or to make the map less busy just make them white or another standard color.

Another option would be to color code the map per Tesla's status and just drop the logo/leaf altogether, or use astericks to identify states where Tesla has an exemption and keep track of the exemptions in the text in the first post.

This would avoid a lot of confusion by people who look at the map but aren't familiar with all the details. For example, I've seen many people, myself included, confused by "red" Washington when Tesla has stores there. Also, the map often gets used outside TMC where it causes even more confusion because people looking at it don't review this thread, and don't even think to look at what the Tesla logo means (and may not even notice it). I think it also undermines the usefulness of the map because people see a red or orange that they know sells Teslas and then dismiss the map's accuracy because they don't notice or understand the color scheme.

Just a suggestion -- thanks for providing such a great resource!

 

[scottf200]

From another thread:

Map is wrong about Washington state, sales and service allowed here.

 

[Pluto]

From another thread:

See below from earlier in this thread in reference to the state Washington:

Automakers aren't allowed to direct sell or service vehicles, but Tesla has an exemption and can do both (notice the blue Tesla logo inside of Washington's borders). There was a bill passed in Washington in 2014 that effectively outlawed any automaker from selling or servicing vehicles themselves unless they already had a location open at that time. Here's the relevant piece of law:

(1) Notwithstanding the terms of a franchise agreement, a manufacturer, distributor, factory branch, or factory representative, or an agent, officer, parent company, wholly or partially owned subsidiary, affiliated entity, or other person controlled by or under common control with a manufacturer, distributor, factory branch, or factory representative, shall not:
(g) Compete with a new motor vehicle dealer of any make or line by acting in the capacity of a new motor vehicle dealer, or by owning, operating, or controlling, whether directly or indirectly, a motor vehicle dealership in this state. It is not, however, a violation of this subsection for:
(vii) A manufacturer that held a vehicle dealer license in this state on January 1, 2014, to own, operate, or control a new motor vehicle dealership that sells new vehicles that are only of that manufacturer's makes or lines and that are not sold new by a licensed independent franchise dealer, or to own, operate, or control or contract with companies that provide finance, leasing, or service for vehicles that are of that manufacturer's makes or lines.

 

[anonim1979]

Michigan:
Michigan settles lawsuit and allows Tesla to sell, fix vehicles

The state of Michigan on Wednesday filed to settle a Tesla Inc. lawsuit that will allow the Silicon Valley automaker to sell directly to customers living in the home state of the Detroit Three.

The settlement "recognizes that any Michigan resident may lawfully buy a Tesla and have it serviced in Michigan,"

The agreement Wednesday determines existing law does not prohibit "Tesla from delivering vehicles to Michigan residents in Michigan (whether directly, through a subsidiary, using an independent carrier, or otherwise), including assisting them with vehicle trade-ins, so long as legal title for any vehicles sold by Tesla transfers outside the state of Michigan," according to Wednesday's filing. A Michigan resident later could transfer the title in Michigan.

The company also may operate service and repair facilities in the state, but it must be through a subsidiary, which Rossman-McKinney identified as "Tesla Michigan."

The settlement also allows Tesla to continue operating galleries in the state like its storefront in Troy's Somerset Collection Mall. Those working at the gallery were previously barred from initiating or assisting any sale of a vehicle, but the state now says that test drives, price discussions, facilitating ordering and purchasing a vehicle and assisting with purchasing paperwork for a sale are permissible activities.

 

[Cosmacelf]

Michigan:
Michigan settles lawsuit and allows Tesla to sell, fix vehicles

I’m a bit confused about the title having to be transferred out of the state of Michigan. What does that mean?

 

[Pluto]

Just a suggestion -- thanks for providing such a great resource!

I appreciate it, I might just do that in the future (or at least provide one or more samples before doing so).

I’m a bit confused about the title having to be transferred out of the state of Michigan. What does that mean?

I am too. Here's some documentation on it, it looks like it's an existing process since at least Feb 2019, but I need to look into it more (unless if someone else does): https://www.michigan.gov/documents/485_72279_7.pdf

Anyways I also need to do a bit more research on whether this applies to other (potential) automakers before editing the map, but it looks like this would make Michigan a blue state.

 

[ItsNotAboutTheMoney]

I’m a bit confused about the title having to be transferred out of the state of Michigan. What does that mean?

It just means that the transaction has to be fully completed outside of Michigan, so that the buyer/lessee has legal right to the vehicle.
They don't mean that it needs a title (document).

 

[anonim1979]

https://www.michigan.gov/documents/...n_for_Entry_of_Dismissal_1-22-20_679161_7.pdf

Neither M.C.L. § 445.1574(1)(q) nor any other provision of Michigan law prohibits a subsidiary that is wholly owned by Tesla (“Tesla Service Subsidiary”) from owning or operating one or more service and repair facilities in the state of Michigan, so long as Tesla itself does not directly own the facilities;

Under Michigan law (including M.C.L. § 445.1574(1)), Tesla’s status as a manufacturer of motor vehicles does not prevent employees of Tesla from performing warranty, recall, service, or repair work in Michigan so long as the work is not performed at a motor vehicle repair facility that is directly owned by Tesla itself, and that those employees are properly certified as specialty or master mechanics, as appropriate, under M.C.L. § 257.1311. In particular, neither M.C.L. § 445.1574(1)(p) nor § 445.1574(1)(q) nor any other provision of Michigan law prohibits employees of Tesla from performing warranty, recall, service, or repair work at a facility owned or operated by the Tesla Service Subsidiary on vehicles owned or leased by Tesla customers;

No provision in M.C.L. § 445.1574(1) nor any other provision of Michigan law prohibits Tesla from delivering vehicles to Michigan residents in Michigan (whether directly, through a subsidiary, using an independent carrier, or otherwise), including assisting them with vehicle trade-ins, so long as legal title for any vehicles sold by Tesla transfers outside the state of Michigan, consistent with M.C.L. §§ 440.2106(1) and 440.2401;

Under Michigan law, employees of Tesla or the Tesla Service Subsidiary are permitted to inspect, prepare, and, if necessary, repair such vehicles in the state of Michigan before they are delivered to the Michigan resident; and

Neither M.C.L. § 445.1574(1)(h) nor § 445.1574(1)(i) nor any other provision of Michigan law prohibits Tesla from operating one or more galleries in the State to educate customers and facilitate transactions out-of-state so long as Tesla does not transfer legal title to the vehicles within the State consistent with M.C.L. §§ 440.2106(1) and 440.2401. Permissible activities at such a gallery include (but are not limited to) conducting demonstration drives; discussing prices, service, financing, leasing, and trade-ins with potential customers; helping potential customers configure a vehicle; facilitating ordering and purchase of a vehicle for which legal title transfers out-of-state; and facilitating customer transaction paperwork for a sale for which legal title transfers out-of-state;

Reddit: Tesla v. Michigan — Settlement Proposal filed

 

[JLF18]

can anyone edit the 1st post? I don't see how to update the map.

 

[dhanson865]

can anyone edit the 1st post? I don't see how to update the map.

If you've been here long enough you can edit that post but I don't have the source graphic to edit the map. We'll have to wait for the original author to update the graphic portion.

I assume want Michigan changed?

 

[anonim1979]

Colorado is tightening their laws. Nothing changes for Tesla.

https://www.bizjournals.com/denver/news/2020/03/03/colorado-electric-vehicle-sales-bill.html

Colorado auto dealers and supporters of a bill to allow electric-vehicle manufacturers directly to residents of this state appear to have reached a détente over a war that’s been simmering for the past two legislative sessions.

State Sen. Chris Hansen, the Denver Democrat who is co-sponsoring Senate Bill 167 with Republican Sen. Kevin Priola of Henderson, added an amendment to the measure last week restricting direct sales to companies that don’t have existing franchise agreements in the state.

...

Under a 2010 dealer-franchise update law, Tesla (Nasdaq: TSLA) was permitted to sell directly to Colorado consumers, and the electric-car pioneer now has five sales sites and two service centers in the state.

 

[RobStark]

Rivian wins big as Colorado passes electric vehicle direct sales law - Electrek

Colorado law will now allow pure BEV automakers that don't have a franchised dealer in the state to open their own stores and sell direct.

 

[MFpisces]

This is LITERALLY the best source of legal information regarding Tesla disputes against Dealerships I've seen on the web. Very nicely done. Please keep updated lol