Tesla No Longer Allowed to Sell Cars Directly In Louisiana

By selling direct to customers and forgoing the “traditional” dealership system, Tesla was bound to ruffle some feathers. It seems that the entire state of Louisiana has taken umbrage to Tesla’s ways, as Governor John Bel Edwards signed a bill into law yesterday that prohibits Tesla from selling cars directly to customers. This marks the sixth state to ban direct to consumer sales, with the others being Texas, Michigan, Utah, Connecticut, and Arizona.

The dealership system is something automakers and legislators deem as an important part of the car purchasing process, and also helps create jobs for local economies. Since Tesla sells directly from the manufacturer to the consumer, they are able to undercut the entire dealer process. A Tesla spokesperson stated:

“Tesla wants to invest tens of millions of dollars in Louisiana, add hundreds of jobs, and make significant contributions to local and state tax revenue. All we’re asking is the right to serve our customers here. Whether they choose to buy from their local dealership or direct from a manufacturer like Tesla, how people choose to spend their hard-earned money on a purchase as significant as a vehicle should be entirely their choice, not something that’s dictated by government regulations.”

In response to Tesla, Rep. Tanner Magee stated (regarding the current restrictions):

“We just tightened it up. I don’t know why we would treat one particular manufacturer different than the rest of the industry…If you have rules, everybody should play by the same rules.”

Magee argues that the law is not meant to stifle competition; rather, it is meant to treat everyone the same instead of what Magee feels is an advantage to Tesla. Louisiana Automobile Dealers Association President Will Green added:

“Tesla has incorrectly painted it as a move … to prevent them from coming to the state. We want them to come. We want them to partner with a local dealer.”

SOURCE | Greater Baton Rouge Business Report

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