Tesla defeats car dealer association in Missouri court

Earlier this year, Tesla was forced to temporarily close its stores in Missouri after the Missouri Automobile Dealers Association (MADA), a trade group representing car dealers in the state, tried to have Tesla’s dealer license revoked.

A three-judge panel of the Missouri Court of Appeals ruled in favor of Tesla this week and dismissed the case in a big win for the automaker’s continuous fight for direct sales.

The court ruled that the dealer association had no standing to sue Telsa.

Local KCUR outlet reported:

“In finding for Tesla, the appeals court ruled on narrow grounds, rejecting the plaintiffs’ arguments that, as economic competitors and taxpayers, they were entitled to challenge the issuance of licenses to Tesla.”

Doug Smith, president of MADA, said that they are still looking into other options to block Tesla.

“We feel very strong about the merits of our argument, and we’re a little disappointed in the final decision.It does have an impact on our industry.”

A Tesla spokesperson also commented on the decision:

“We have been serving customers in Missouri for almost five years and have contributed to the state economy and jobs for Missourians – something that will now continue,”

The automaker operates 2 stores and a service center in the state.

Tesla has been in a long ongoing state-by-state battle to sell its electric cars directly to consumers without having to go through third-party dealers.

Sometimes car dealers and sometimes other automakers are challenging Tesla’s right to sell directly to customers as an automaker based on outdated laws that prohibit automakers to compete with their franchise auto dealers, which Tesla never had.

Tesla refuses to go through third-party dealerships due to their proven inability to sell electric vehicles efficiently either due to the lack of desire or knowledge, as shown by a study last year. Of course, the other important reason is that dealerships make most of their profit on servicing the vehicles they sell, while Tesla aims not to make a profit on service.

Lately, Tesla’s biggest direct sale battles have been in Michigan and in North Carolina, but they seem to have been stalling.