Tesla Vs. Chris Christie: Innovative Company Barred From Sales In New Jersey
Tesla Motors, the cutting-edge automaker which has led the way in manufacturing and marketing all-electric, battery-powered cars, can no longer sell its innovative and environmentally friendly vehicles in New Jersey, thanks a recent state rule change backed by Governor Chris Christie.
Tesla has two dealerships in New Jersey, both of them owned directly by the Palo Alto, California-based company. But New Jersey this week put a rule into effect banning any company from selling its own cars directly to the public, starting April 1. Instead, the state requires vehicles to be sold through car dealerships owned by middlemen.
The new rule would put the Tesla dealerships out of business.
New Jersey Governor Chris Christie earlier this month gave a speech in which he praised the virtues of an unregulated marketplace economy in almost religious terms.
“We are for a free-market society that allows your effort and ingenuity to determine your success,” Christie who remains a contender for the 2016 Republican presidential nomination despite a spate of recent scandals, told fellow Republicans in the speech. “Not the cold, hard hand of the government.”
But his administration did not hesitate to apply the cold, hard hand to Tesla, leading the automaker to lash out at Chris Christie for reneging on a promise to bring the issue of direct auto sales before the state legislature, allowing elected officials to decide the future of Tesla in the state.
Instead, the electric car company blasted Christie for deciding to “go outside the legislative process by expediting a rule proposal that would completely change the law in New Jersey.”
The company also took to its official Twitter account to lambaste the Chris Christie administration — and New Jersey’s auto dealers.
Dealers want regulation that could ban Tesla from selling cars in NJ IMMEDIATELY, despite having 2 licenses to do so. Bad for innovation.
— Tesla Motors (@TeslaMotors) March 11, 2014
Christie administration & dealers trying to sneak anti-Tesla regulation through while keeping consumers in the dark.
— Tesla Motors (@TeslaMotors) March 11, 2014
For their part, the auto dealers argue that forcing car companies to sell through third-party dealerships is an important way to protect consumers.
“The Tesla factory-owned store model destroys price competition and restricts consumer access to warranty and safety recall service,” said Jim Appleton, president of the dealers’ political lobbying body, the New Jersey Coalition of Automotive Retailers.
Tesla said that selling cars directly is not simply about the bottom line.
“It is also about educating consumers about the benefits of going electric, which is central to our mission to accelerate the shift to sustainable transportation, a new paradigm in automotive technology,” the company said in a written statement.
Traditional car dealers who, of course, sell mostly vehicles that run on fossil fuels, don’t know how to sell electric cars or explain their benefits, Tesla said.
