Tesla Motors Inc (NASDAQ:TSLA) is facing hinders regarding opening of its showrooms from different states from many groups. In court cases, it is said that people should be restricted to purchase cars directly from Tesla’s showrooms. They claimed that direct sale procedure is against the laws of automotive franchise. The group also argued that franchise dealers should be used by electric car maker to increase their sale process in Buckeye State as well.
In past couple of years, Tesla was trying to be blocked for direct selling of its car by car dealers in states that includes Minnesota, New York, Georgia and New Jersey. Recently sever constraints are imposed on Tesla by Texas dealers and selling process is restricted by Arizona and Virginia as well. The same franchise law is followed in New Mexico that does not allow direct sales from showrooms of the companies.
It is also said that Tesla is setting a new example of independent selling process that will encourage other automakers to avoid franchise dealers that are working for more than eighty years. Dealers also said that by allowing Tesla to sell its models directly, then future startups or applicants from China or elsewhere will also follow the same method or may create online selling showrooms that will severely hurt franchise dealership tradition.
According to Rhett Ricart, president of Ricart Automotive in suburban Columbus and a claimant in a court case filed against Tesla Motors Inc (NASDAQ:TSLA) in Ohio, he doesn’t want that hydrogen cars that came in market five years back and engulf the whole industry. It’s quite devastating. Ricart also added that ecofriendly cars are being introduced by Tesla that is appreciating but all these rules are created to defend users in these states.
The company is both selling new models and sponsoring a new equipment so these outlets are essential in the states, according to Tesla’s vice president of business development, Diarmuid O’Connell, who said last week.
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