Tesla’s Fight With Auto Groups Switches Up A Gear As NY Joins In

By · June 24, 2013

Tesla Model S

Tesla is determined to fight auto dealer associations for the right to sell its own car.

In the ten years since it was founded, California-based Tesla Motors has ruffled more than a few feathers in the automotive industry with its fresh-faced thinking. Not only is its Model S electric sedan the best electric car money can buy, but the company—led by its tenacious CEO Elon Musk—is fighting a massive war against dealership trade groups for the right to sell its cars directly to its customers.

To date, most of Tesla’s bloody battles have revolved around well-established legislation in some 48 states which make it illegal for automakers to sell cars directly to the public, forcing them to sell through franchised dealerships.

But on Friday, auto dealer industry groups in New York tried a new tactic: backing the introduction of a bill into the New York State Legislature which would not only make future Tesla Stores illegal in the state, but also force Tesla to close its existing store in New York City.

As GreenCarReports points out, the legislation would make it impossible for anyone in New York State to buy a car unless it is sold by an independently-owned third party.

Independent Dealers Only

The two bills, S05725A and A07844-A, were introduced to the New York State Senate and Assembly on June 7 and June 6 respectively. They both seek to “amend the vehicle and traffic law, in relation to automobile manufacturers and business practices by franchisors.”

If passed, the two bills would make it illegal for New York State to issue licenses to any auto dealer wholly or partly owned by an automaker. Further still, it would prevent existing dealerships from renewing their state licenses if they are owned in part or whole by an automaker.

The only exception to the rule would be dealerships where a license was issued before July 1, 2006. Since Tesla opened its New York store after that date, it will fall foul of the proposed legislation.

In fact, the only car company affected by this legislation would be Tesla, since it is the only automaker in the State of New York selling its cars directly to consumers which obtained its first license after the exemption date.

Damaging to New York and Tesla

“The bottom line for New York consumers and New York suppliers is that if this bill passes, special interests in Albany will once again have gotten their way while robbing New Yorkers of choices in the marketplace, and Tesla will be put out of business in New York,” Tesla said in an official statement on Friday.

But, the company warned, changing law to prevent Tesla from selling directly to consumers in New York wouldn’t just affect Tesla. It would affect all of the companies it works with in the state.

“It means that New York-based suppliers to Tesla will lose business and New York consumers cannot buy the most advanced electric car in the world today,” Tesla continued. “With the state of New York pushing so hard to lead green innovation supporting entire agencies for energy efficiency like NYSERDA, it absolutely defies logic to ban Tesla from selling electric cars in New York.”

Fan Support

While Tesla’s fate in the state of New York is yet to be determined—and with other battles ongoing in states across the nation—Tesla fans are rallying around the automaker in every way they can to help it fight auto dealer associations.

One such attempt comes courtesy of an official online petition, which asks the current administration to step in so “States should not be allowed to prevent Tesla Motors from selling cars directly to customers.”

With only 4,560 signatures out of the required 100,000 needed and only another two weeks before the petition deadline is reached, it’s unclear if this particular petition will have its desired effect.

Regardless of what happens in New York however, one thing is clear: Tesla, and Musk, aren’t about to let the auto dealers win.

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