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Laws That Ban Direct Auto Sales Are Not Just Hurting Tesla, Says FTC

Laws That Ban Direct Auto Sales Are Not Just Hurting Tesla, Says FTC
[Photo: Flickr user Windell Oskay]

Since it started selling its electric cars directly to consumers, Tesla Motors has faced stern opposition in several states–many outright refusing to allow Tesla to sell cars within their state borders–for being the only automaker that does not use auto dealers to sell its cars. Today, three directors of the Federal Trade Commission went to bat for Tesla in a blog post condemning states for interfering with consumer choice to buy whichever car they want.

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Originally, laws were put in place preventing car manufacturers from selling cars directly to consumers to prevent them from colluding to inflate car prices. Hence the need for auto dealers, which incidentally brings money to local businesses. But those laws are outdated, says the FTC, and consumers should be able to choose from whom they buy their cars.

But these laws are not just Tesla’s problem, the FTC blog post states: New Jersey finally relented and allows Tesla to sell its cars directly to consumers, but only Tesla, and only through a few stores. Elio Motors, makers of the $6,800, 84-mpg “autocycle,” would also be prohibited from selling its car-motorcycle hybrid directly to consumers. Elio Motors can shave down that price partially because it plans to sell directly to consumers–but extant laws getting in Tesla’s way will also prevent Elio Motors from directly selling its autocycles.

The FTC post pushes Michigan voters to support SB 286, a bill that would allow specific permission for manufacturers to sell autocycles directly to consumers. Yes, it is still a bill that allows unique exceptions instead of opening the door wide to manufacturers of all automobiles, but it is a start.

[via Ars Technica]

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