Tesla Motors Urges Amendment to Store-Blocking Legislation in Minnesota (UPDATE)

MAR 7 2013 BY ERIC LOVEDAY 9

Tesla Motors is now trying to exercise its political might.

Amend the Legislation...Urges Tesla

Amend the Legislation…Urges Tesla

Tesla is urging legislators in Minnesota to amend some legislation that would block the automaker from opening stores and service centers anywhere in the state, including at Tesla’s proposed site within the Mall of America.

Last month, the Minnesota Automobile Dealers Association used its collective force to convince legislators to rewrite Minnesota’s franchise law to essentially exclude Tesla, or any other vehicle manufacturer, from operating its own dealership

Under the state’s current law, a manufacturer is prohibited from competing with a same-brand franchised dealer, but is able to open a dealership as long as it doesn’t compete with an existing franchised dealer.  Tesla would be in the clear under these guidelines because the automaker has no franchised dealers to compete with.

Scott Lambert, executive vice president of the Minnesota Automobile Dealers Association, claims the legislation is not aimed Tesla, but rather at sealing a gap in the state’s old-school franchise laws.

But that’s not the story that flowed from Lambert’s mouth when he learned of Tesla’s two proposed sites:

“We’re not happy about granting them an exemption.  We’ve got dealers who have made big investments in their dealerships. A factory-owned store, it’s a whole different model, and it’s not fair.”

Lampert claims to have not been aware of Tesla’s proposed site until the automaker contacted just over one week ago, but that seems unreasonable given the fact that Tesla plans to open a store at the Mall of America in Bloomington, Minnesota during the first half of 2013.  And a service center elsewhere in the state in 2014.  And that Lampert heads the state’s dealers association.

Diarmuid O’Connell, Tesla’s vice president of business development, responded to the store-blocking legislation, saying “we are merely trying to preserve our ability to operate.”

Tesla’s amendment (which we’ll try diligently to hunt down) hasn’t been added to the legislation and can’t be until all the political steps and hurdles (there’s thousands of those, right?) are overcome.  If it does make it into the legislation, then the entire voting process would return to square one.

O’Connell concludes:

“The bottom line is, we’re anxious to come to Minnesota.  We think the product is a great match for the market.”

It’ll be interesting to see how this one plays out.  Can Tesla convince politicians to amend legislation?  We shall see.
UPDATE: Tesla Wins!!!   At least for now.  See Elon Musk’s Tweet below.

musk tweet

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9 Comments on "Tesla Motors Urges Amendment to Store-Blocking Legislation in Minnesota (UPDATE)"

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vdiv
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vdiv

Worst case scenario, smuggle Model S cars from Canada. Just ask for Bob at yer local speakeasy 😉

James
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James
Carmakers are scared of the Model S – dealers are scared of the Model S. Politicians are scared of the model S ( well, conservative politicians ). It’s actually quite funny. How can such a tiny car company be so derisive? It’s because the American auto industry is antiquated. The horse-trader mentality, obsolete. When I sold cars back in the nineties, people who’d purchased cars in Europe gagged when they had to negotiate price like camels in the desert. “Why can’t you just give me the price?!!”, They’d ask. Disruptive technology, like Tucker in the 1940s, tends to cause the established behemoth brands to panic. They’ll sometimes purchase the small company to quash such competition, or try to seek help from the federal government ( Tucker, U.S. Chicken Tax…etc. ) to retain their control over the market. To hear Bob Lutz talk about Tesla in the film Revenge Of The Electric car is really humorous. This little Silicon Valley startup making the Big Three look stupid. Do they notice? YOU BET THEY NOTICE! If Tesla sells a significant amount of autos expect buyout offers from large auto corporations. Should Tesla bite? Probably not. They’ll release control, and give that company… Read more »
vdiv
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vdiv

Well-said James! The evolution, trials and tribulations of EVs has been an eye-opening and a life-changing experience for many of us. Tesla and Musk are not Gods and are not perfect by any means, but they have an incredibly important role to play, and have earned our support.

Anton Wahlman
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Anton Wahlman

I believe you are mis-stating the conservative position here. The conservative position is that business should be unregulated. You should be allowed to open any business you want without any government permit or ability to block. It is the opposite side of the isle who is in favor of granting the government the power to regulate business. Therefore, it is in the free market where Tesla would be run its business any way it wants, whereas it is in the world of government regulation that the government has the power to block anything Tesla might want to do, such as open a store.

James
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James
When I stated, “politicians are scared of Model S…” ( mainly conservative ones ) It was purely denoting the fact that each and every Republican frontrunner starts sounding like a Texas oilman. I myself am a conservative-leaning independant, yet I will not vote for a Mark Rubio or ANYBODY who starts stating “energy independence” means more oil wells, more oil pipelines and more oil and gas jobs. “Drill Baby Drill” of 2008 has morphed into “American ( oil ) Energy Independence”. One of the only things I agreed with in Obama’s debates was that Romney’s energy platform was written by the oil companies – I read it on Romney’s page and it was pathetic. I’m a big plug-in vehicle proponent, and yes, I’m conservative – we do exist. Look at GM’s board of directors and see at least two big oil guys – it’s the same throughout the car industry. It’s really tough for these guys to conform to current gov. mandates on mileage and appease the Big Oil industry simultaneously. A search of major Repubs campaign finances reveals many big energy boys sending big checks. Today’s stark derision in Washington D.C. has liberals and conservatives alike disgusted. I can’t… Read more »
evnow
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evnow

“Free Market”, auto dealers version.

@James – your rant is valid but not on this topic. This is all about local dealers buying off local legislators. Not about the Big 3.

carguy
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carguy

EVNOW is right. This is about an antiquated dealer model trying to preserve its relevance. Nearly all auto mfrs have some form of EV and the success of Tesla is welcomed by the industry. If you are up for some real fun, do some research into the efforts of auto dealers across the nation to buy legislator votes on legislation guaranteeing them greater profits at the expense of consumers. Over 30 bills nationally this year alone, and over 100 in the last 4 years.

James
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James

Thanks, but … I don’t consider what I said a rant… I wasn’t
bitching and moaning – it’s merely a description of fact.

It’s relevant in the first sentence – …”dealers are scared of the
Model S…” The NADA attacked Tesla on this same premise
and lost – it’s attacked Tesla before and lost, and thanks to
the update here – this localized dealer association has
possibly lost here also.

It’s absurd because Tesla’s showrooms and maintenance
facilities do not violate existing laws and new laws nor
ammendments do not need to be written because of Tesla.
Quite simply, there is no conflict of interest – Tesla does not
license private franchises – PERIOD – end of story. Yet the
fears I speak of are raw and real – as state by state, and
in national dealer associations we’ll keep seeing this
nonsense – and what a waste of money legally for Tesla.

GSP
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GSP

Great to hear this bill was defeated. Go Tesla!

It is bordering on the absurd that Tesla has to fight just for the right to sell its products, and potential customers have to fight for their right to buy them.

GSP