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Tesla Sales Banned in New Jersey... hopefully not for long!

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I am absolutely certain that Tesla will pursue this both in court and in the New Jersey statehouse. In the meanwhile, it's enjoying the free publicity.
NJ has now decided that it will not permit tesla to also be a "dealer"
at this point taking this the to the courts or getting the legislature to change the law is tesla's only option

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I haven't been on here much today and just skimmed the pages and didn't see this link yet:

Poll: Should companies like Tesla be allowed to sell electric cars directly to customers NJ? | NJ.com
as of 7:30 am 82+% voted that tesla should be allowed to sell directly to consumers, maybe the legislature will take this up if they can be diverted from their usual agendas
 
Does anyone know what the penalty is for selling cars in NJ without a dealer license? I looked on the Motor Vehicle Commission website and couldn't find anything. Perhaps Tesla should just keep selling in an act of civil disobedience to draw attention to an unfair law (or ruling interpreting the law) that prevents a new company from selling its award-winning product directly to consumers. Shining a light on the corrupt NJ protection of its auto dealer cartel may be worth the penalty if it embarrasses the legislators into changing the law. And being that NJ is covered by the New York media market it would be sure to get national attention.
 
Does anyone know what the penalty is for selling cars in NJ without a dealer license? I looked on the Motor Vehicle Commission website and couldn't find anything. Perhaps Tesla should just keep selling in an act of civil disobedience to draw attention to an unfair law (or ruling interpreting the law) that prevents a new company from selling its award-winning product directly to consumers. Shining a light on the corrupt NJ protection of its auto dealer cartel may be worth the penalty if it embarrasses the legislators into changing the law. And being that NJ is covered by the New York media market it would be sure to get national attention.

Great idea!
 
I think Tesla made a mistake not immediately working on challenging the first of these laws with the intent of working it up through the federal court systems. Such things take years if all the major population states like NY and Texas start banning Tesla, then by the time Gen3 is around, Tesla will be completely hamstrung in tons of states and years from having the relevant law suits before federal courts. Model S buyers might be willing to deal with the hassle, but mass market won't be.
 
- In an informal poll, over 80% of NJ citizens (or at least those who read the NJ paper) voted to be allowed to buy direct from Tesla.
- People world-wide are aware of what is going on in NJ.
- A couple of NJ legislators are now talking about getting this overturned.
- In the meantime, NJ citizens are free to drive a arguably short distance and visit Tesla showrooms right across the state line. No laws against purchase.

So because of Tesla's 'in your face' response, we have world-wide publicity about what the dealerships are about - meaning citizens in other states are more informed than they would have been, when the same starts to happen there. The NJ kerfuffle will be something that no other governor or state legislator will want to repeat.

Tons of free publicity.

Inevitably, Tesla will be selling in NJ.

Huge positive publicity Tesla, huge negative publicity dealerships, temporary inconvenience to consumers while they vote with their feet out of state. Tesla has a supply constraint, not demand constraint. Losing a few sales while they fight this battle isn't an issue.

Of course, the alternative was they could have played typical NJ politics, quietly made it happen, and continued to fight each state quietly (read 'expensively') as the dealership lobby brought full force to bear. I'm of the school that sometimes the curtain needs to be ripped back, way back, to let the sun shine in so everyone can see what's going on.

Short-term this might have seemed to some to have been the foolish route to go. My opinion is it will prove out to have been a brilliant strategy.
 
Of course, the alternative was they could have played typical NJ politics, quietly made it happen, and continued to fight each state quietly (read 'expensively') as the dealership lobby brought full force to bear. I'm of the school that sometimes the curtain needs to be ripped back, way back, to let the sun shine in so everyone can see what's going on.

Short-term this might have seemed to some to have been the foolish route to go. My opinion is it will prove out to have been a brilliant strategy.
I think the mistake is playing this small ball in every state in what appears to be the only plan, where the best case outcome playing small ball everywhere still loses some states.

It's fine to play things the way they did in NJ if they also have a federal strategy already working its way along.
 
I'd bet good money that they have a big picture in mind.
I hope so. Diarmuid's statements didn't exactly give the impression they had a big picture plan yet on this.

We've discussed, and we'd pursue if we have to. We don't want to be in these dust-ups. We're fundamentally an engineering company. We're not interested in legal or legislative strategies as a preference. We do things when we need to. Going to the Federal courts or national legislature is something we've discussed.
That just doesn't come across as a person with a solid proactive master plan, more like a reactive stance where they'll only pursue it once forced. Reminds me of the Red Green show's lodge mantra "I can change, if I have to, I guess".
 
Of course, the alternative was they could have played typical NJ politics, quietly made it happen, and continued to fight each state quietly (read 'expensively') as the dealership lobby brought full force to bear. I'm of the school that sometimes the curtain needs to be ripped back, way back, to let the sun shine in so everyone can see what's going on.

I think this is key. If you want to fight corruption, you can't join into corruption (ahm, sorry I meant to say "lobbying"). So the best thing to do is to make corruption as expensive as possible. Not that I think the NADA & Co are poor but if it becomes politically expensive for state legislators to support them, we have a chance of winning this on the long term.

These days there are indeed a bunch of world-wide articles making fun of the "land of the free" that is incredibly much more regulated than "communist China" when it comes to car sales. That's quite an achievement...

So in this line of thought: What else can be done to make this kind of lobbying more 'expensive'?
 
Wouldn't a Tesla NJ Subsidiary Suffice as a Dealer?

Maybe I am missing something here, not also having read NJ regulations regarding car dealers, but it seems to me that those franchise regs are open to the interpretation that they exist to make sure anyone selling new cars has a contractual arrangement with the manufacturer, not that there has to be a nonmanufacturer middleman. If the dealer IS the manufacturer, it accomplishes the purpose.

The other line of attack, which I am surprised Tesla hasn't already used, is to form a wholly-owned subsidiary in the protectionist states whose role is sales and service. It then gets a franchise from the parent corp.

I'm not a lawyer, so will someone enlighten me about why those two approaches haven't been tried?
 
That just doesn't come across as a person with a solid proactive master plan, more like a reactive stance where they'll only pursue it once forced. Reminds me of the Red Green show's lodge mantra "I can change, if I have to, I guess".

It does seem, according to that statement, that Tesla is taking a reactive stance instead of the preferred proactive stance you'd like them to take/you think they need to take in time for the Gen III car. The reality is that Tesla doesn't have the resources to go the way you want them to go, not at this time. It's like taking a knife to a gunfight. Tesla can't out-spend, out-lawyer, out-politician, and out-media the entire United States dealership, oil etc... network. They can't and attempting to do such a thing will destroy them, taking valuable resources away from the Secret Master Plan and all that they are currently doing; China, RHD market, AWD Model X, Super Charger Network, Battery Swap Stations, Giga Factory... You must understand that fundamentally.

What Tesla does have in abundance and of at least in equal proportions (I think more) to the 'baddies' is brain power, and I consider their current approach to be wickedly clever. Continuing to present themselves as the 'little guy/underdog' (because they are), letting segments of the public become outraged/take action like showing up en masse at these backdoor meetings/taking politicians for rides in the car/etc..., and letting the 'big, bad wolf' stomp all over Granny, while proclaiming at the top of his lungs how he's just concerned for Granny's health has already shown to pay off and will continue to pay off, imo.

You don't think the mass market will go out of their way to get a Gen III car if they have to. I think you're entirely wrong about what middle America will do when that car hits the streets and starts making waves and someone tries to tell them they can't have it. People camp out in horrid weather conditions for tickets to a concert, for a chance to get on American Idol, to try and get that special toy for their kids for Christmas, to make a statement about this or that. They break the law to protect endangered species, to stand up for things they believe in, to shine a light on injustices. They chain themselves to trees to protect natural resources, people purposely disrupt traffic and businesses, and they start revolutions risking death to oust corrupt leaders. Never underestimate the power of people who think they've been wronged, especially if they also feel helpless and hopeless.

I also think there's likely more going on behind the scenes at Tesla on this front. I can almost imagine a huge war room table with an elaborate, coordinated plan of attack laid out on it. Elon Musk had to know this fight was coming, and I have no doubts that he already played out every possible approach, strategy and scenario. I wouldn't be surprised if he also calculated a percentage of success or failure to each.

Have a little faith. (And do what you can as an individual.)
 
I'm not sure if it works this way in every state, but in California the only real difference between buying from a licensed dealer and a private party is that you have to deal with all the government paperwork (DMV) yourself when you purchase outside of a licensed dealer. I had a dealer licence in the past, and as a dealer it was a pain handling the paperwork with the DMV. There were several services that I could hire to do the paperwork for me. Tesla could just use these service folks to handle the paperwork, and the customer would not have any different experience in purchasing the car than buying from a licensed dealership. To complete the loop, Tesla could register as one of these vehicle registration service businesses and then handle the paperwork just like a dealership, but not being a dealership.

So you order your car from California over the internet. It gets sent to the service center closest to you, where you go to pick it up. When you arrive, what you discover is that right next door (or across the street) there is a separate business called Tesla Registration Services where for $1 you can hire them to do all the paperwork for registering your new car with the appropriate government agency.

Perhaps this business is only a California thing(Vehicle Registration Service Companies) and its not universal, but having a separate business that is owned by Tesla that just does Vehicle Registration Services seems like an easy way around the stupid franchise laws.
 
When people are told by government that they aren't allowed to have something that perks their interest, they find a way around government interference. Look at what happened during alcohol prohibition and the resultant plethora of speakeasies. The dispute between Tesla Motors and the dealerships in bed with politicians garners media attention for a company that does not advertise. Car dealers and politicians are already at the top of the public's dislike lists. This interference with supposedly free enterprise is occurring while Tesla is still production constrained, not demand constrained. Thanks to New Jersey, buyers in Europe and Asia may be able to obtain delivery a teeny bit earlier.

People in New Jersey will still be able to get a Model S. They'll just have to jump over a couple of low hurdles. Then they'll beam with pride when they show what they own to friends. In turn those friends will want to get one. People demanded the end of alcohol prohibition, and they'll demand the end of direct car sales prohibition. Either through public indignation or the ruling of federal courts, the dealership issue should be swept aside at just about the time Tesla Motors ramps up for mass production of the Model E and the public has finally become widely aware of the Tesla brand.
 
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Inevitably, Tesla will be selling in NJ.

please share with me when you believe that this will happen, because short of the courts getting involved or the legislature changing the statutes Tesla cannot sell cars in NJ

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I hope so. Diarmuid's statements didn't exactly give the impression they had a big picture plan yet on this.


That just doesn't come across as a person with a solid proactive master plan, more like a reactive stance where they'll only pursue it once forced. Reminds me of the Red Green show's lodge mantra "I can change, if I have to, I guess".
I tried to give you plus rep but I did already on another comment, you seem to have a decent grasp of what is going on.