Tesla Motors Inc (TSLA) Still Fighting Auto Dealers

Tesla Motors Inc (TSLA) Still Fighting Auto Dealers
Blomst / Pixabay

Tesla Motors Inc (NASDAQ:TSLA) has won a small victory in New York after the state legislature shelved two bills which would have made it illegal for the company to sell its vehicles in the state. The bills were aimed at the company’s direct to consumer sales model. Auto News reports that the New York State Assembly adjourned late on Friday without voting on the bills and won’t meet again until January.

Tesla Motors Inc (TSLA) Still Fighting Auto Dealers

Tesla CEO Takes To Twitter

CEO Elon Musk took to his Twitter account, as he is known for doing, and rallied a cry for owners and aspiring owners of Tesla Motors Inc (NASDAQ:TSLA) vehicles. He urged them to call their state senators and get them to vote against the two bills.

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Over the weekend, he posted on Twitter again, this time thanking those who helped kill the bills. He said the bill was “stopped in the 11th hour due to public outcry.”

Tesla Still Faces Problems In Arizona, Other States

Although the New York state bills were shelved just in time, Tesla Motors Inc (NASDAQ:TSLA) still faces challenges in other states. The Arizona Daily Star reports that while Arizona residents can visit one of Tesla’s showrooms in their state, they have to drive to California if they want to test drive one. Their other option is to plunk down the $2,500 refundable deposit by ordering one on Tesla’s website without test driving one.

Tesla Motors Inc (NASDAQ:TSLA)’s big challenge has been fighting auto dealer associations in various states. Some, like Arizona, do not allow manufacturers to be dealers. Musk has said he would take the fight over Tesla Motors Inc (NASDAQ:TSLA)’s direct to consumer sales model to the federal level if the company continues to face challenges at the state level.

It doesn’t appear as if the company’s fights will get any easier at the state level. The company has said that its sales model improves upon the vehicle purchasing process because there is no haggling over prices. Also most dealerships make the majority of their money on service, and since Tesla’s vehicles are electric, they need a lot less service than traditional vehicles do.

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