Tesla Motors Inc (NASDAQ:TSLA) recently lost the battle for its direct to consumer sales model in New Jersey (in a rather back-handed way, it seems). However, while the automaker’s losing battles get a lot of press, it’s worth noting that Tesla can still sell cars in most of the country using its sales model.
Tesla fights battles in two states
Forbes contributor Mark Rogowsky put together a nice map showing where Tesla Motors Inc (NASDAQ:TSLA) is able to freely sell its cars directly to consumers. Currently there are restrictions in process to limit Tesla’s ability to sell cars directly to consumers in two states, which are New York and Ohio.
Tesla Motors Inc (NASDAQ:TSLA) has already won the battle in three states—Minnesota, Massachusetts and North Carolina—and lost the battle in Arizona, Texas, Virginia, Maryland and New Jersey. There are restrictions—but not complete bans—in Colorado and Georgia.
Tesla tantalizes drivers
Tesla Motors Inc (NASDAQ:TSLA)’s presence in Arizona, Texas, New Jersey, Maryland and Virginia is now basically one about just teasing drivers. The automaker has showrooms in those states but is unable to actually sell its cars. The people who work in those showrooms—whatever their job title is—can’t even tell potential customers how much the cars cost or help them buy one. However, Tesla’s cars are still available for purchase on the company’s website. In Maryland, customers can even test-drive a Tesla, but they still can’t buy one there.
In Georgia, there’s a pretty odd restriction on Tesla Motors Inc (NASDAQ:TSLA)’s ability to sell cars there. The company is only allowed to sell 150 of them in the state. That falls under an exemption from the auto dealer rules. A bill that’s pending in the state legislature would raise that number to 1,500, although drivers would then not receive the state’s $5,000 rebate for an electric vehicle.
In Colorado, the automaker has one store located in just outside of Denver. A state law was passed there after that store opened. As a result, the one store is allowed because it has been grandfathered in, but Tesla Motors Inc (NASDAQ:TSLA) can’t open any other stores.
Tesla wins in some states
If you’re keeping score, Tesla Motors Inc (NASDAQ:TSLA) has managed to use the law to its advantage in the three states where it has triumphed. In other words, while auto dealers are lobbying for laws which ban Tesla’s sales model, Tesla has been able to win in some state legislatures. In both Minnesota and North Carolina, a bill which would have kept Tesla from selling there died in the legislature. In Massachusetts, Tesla sued and actually won after auto dealers tried to keep it from selling there.
According to Rogowsky, Tesla Motors Inc (NASDAQ:TSLA) is now banned from selling directly to 57 million people (the residents of the five states which outlawed its sales model). The automaker faces restrictions on selling to 15 million people and could lose its ability to sell for 31 million others. He notes that if the automaker loses in both New York and Ohio, that will mean nearly a third of the U.S. population will have difficulties in purchasing its cars. Tesla did win one battle in Ohio in December though, so that’s at least a foothold there.
