Elon Musk Wins Fight to Sell his Tesla Model S Electric Sedan in New Jersey
Arthur Dominic Villasanta | | Mar 19, 2015 09:30 AM EDT |
(Photo : Reuters) The Tesla Model 3 will be unveiled next month.
New Jersey Gov. Chris Christie has just signed a law that will allow Tesla Motors to directly sell its Model S electric vehicle to customers in the state and bypass car dealerships that strongly oppose this move.
This critical victory for Elon Musk overturns a ban imposed on the Model S instigated by the car dealerships in the state. The new law allows automobile makers that manufacture zero-emissions cars to operate a maximum of four direct sales dealerships in New Jersey.
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"A huge victory in New Jersey for consumer choice: We are open for business!" triumphantly tweeted Tesla Motors.
Car dealerships, which have huge clout lawmakers, are violently opposed to the idea of Tesla selling its cars directly to customers, said Tech Times. The Federal Trade Commission, however, criticized the car industry, calling its strategy of opposing direct sales to customers "protectionist."
Most car makers use third-party franchised dealerships to sell their cars. This ban on direct sales to customers now exists in four states so Tesla has had to fight against dealership associations state-by-state. Direct sales of Tesla's Model S remain banned in Arizona, Maryland, Michigan and Texas, however.
Tesla CEO Elon Musk believes electric vehicles shouldn't be covered by the standard procedures and laws for automobile sales as they're newcomers to the car industry.
Musk has also loudly criticized the sales practices of car dealerships, saying they push for customers to buy items they don't need or compel them to buy vehicles that are more expensive to make bigger commissions.
Musk even called the opposition from dealerships to Teslas's business model as a "Mafia version of 'protection.'"
Last year, Tesla was banned in New Jersey from selling its vehicles directly to customers. Christie, however, said that if the law was changed, he'd sign it once it came to his desk.
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