Tesla faced disappointment when a bill that would have allowed the company to sell vehicles directly to Connecticut consumers failed to pass due to alleged inaction of the state senate, according to spokesperson Will Nicholas. The bill passed swiftly through the state’s house of representatives in May.
Tesla to fight back
However, the company is in no mood to give up and will ask the general assembly to resubmit the proposal during the upcoming special session, but there are doubts about whether lawmakers will take it up. If there is no action taken on the bill in the special session, Tesla will present it again next year.
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The Palo Alto-based company said it would like to re-evaluate the strategy, when asked if it will go by the same proposal in which a compromise was done with the auto dealers association. Nicholas said, “We’ll still have a very compelling argument to come and be regulated and fairly compete in the state.”
Diarmuid O’Connell, vice president of business development for Tesla, said that the company will continue to serve current customers with its service center in Milford and “welcome others that learn of our technology and vehicles in other states.” The executive also said that the company is drawing up a plan to work with lawmakers in the next legislative session, which begins in February. At present, Tesla has stores in around 20 states, including New York and Massachusetts.
A compromise between Tesla and dealers
For some time, the automotive retailers association has opposed Tesla’s proposal to save the long standing state law that does not allow car manufacturers sell directly to consumers. During the negotiations, the car maker tried to get five stores, but ultimately it was allowed to have three stores. Just like other car manufacturers, Tesla was also required to comply with consumer protection norms in place by the Departments of Motor Vehicles and Consumer Protection.
James Fleming, president of the Connecticut Auto Retailers Association, said that the relaxation in the state’s franchise law is “limited” and does not block the future possibility of direct sales stores joining the dealer franchise system if they enhance their potential. However, there were some individual dealers who did not support the legislation.