Tesla has long been having issues selling its cars in Texas due to their direct-sale law and car dealer lobbying effort, but now the automaker’s situation is becoming even more precarious in the state as a new bill that could block them from even servicing their cars is being introduced.
Texas is one of the biggest markets in the US that still completely bans Tesla’s direct sale model.
The local car dealer lobby is using old laws meant to stop automakers to compete with their own franchise dealers to block Tesla from selling their own cars directly to consumers even though Tesla never had any franchise dealers.
Many see this as a free market issue as car dealers appear to be using the law to protect themselves from competition and create a monopoly.
Tesla has launched several lobbying efforts to change the law over the years, but they always failed to convince the legislature, which is being influenced by the car dealer lobby.
Despite this issue, Texans have bought thousands of Tesla vehicles, which the automaker delivers from other states to comply with the law.
Tesla has been able to service those vehicles through its own service centers, which are not subject to those same direct-sale rules, but now dealers are even going after Tesla’s right to service its cars.
Republican Senator Kelly Hancock introduced a new bill (SB 1415) that would ban Tesla from servicing its cars through its own service centers if it gets through the legislature.
According to the draft, it would be effective as soon as September 1, 2019.
We contacted Tesla about the situation. A spokesperson said that they are aware of the bill and they are looking into it.
Here’s the full introduced draft of the bill:
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Well, Texas’s use of direct-sale laws was already ridiculously abused but they are now pushing it to a whole new level of stupidity.
If the legislature actually approves this bill, it would be extremely disappointing from a political standpoint and a major hit to Tesla itself and Tesla owners in Texas.
Texan EV fans, or free market fans for that matter, should contact their local representatives and let them know how you feel about this ridiculous attempt to abuse legislation to give a monopoly to franchise dealers who are afraid of fair competition from Tesla and other companies looking to sell and service their own vehicles.
While Tesla would be the most affected company at this point, I think other companies, like Rivian, should be joining the fight here.
What do you think? Let us know in the comment section below.
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