Tesla, the car making company, has voiced its concern with a proposed Michigan legislation banning sales of cars to consumers directly. In an official company blog post Thursday, the luxury car maker criticized the bill passed secretly by the Michigan's state legislature earlier this month. If signed into law, Michigan could become the latest state to ban direct sales of Tesla cars to its consumers. But the bill, HB 5606, is subject to approval from Governor Rick Snyder, who has until Tuesday, Oct. 21, to make the final decision.
The bill does not specify Tesla's sales method but the California-based car maker is the only one proposing direct sales in Michigan. Tesla has refrained from conducting its car sales through franchised dealers. After successful online sales of its all-electric cars, Tesla is now pushing to lead retail sales without any involvement from the dealers. This way, the company aims to keep the cost of its vehicles low. According to The Detroit News report last week, car dealerships in Michigan charge as much as 5 percent of the car's price with a $200 cap.
"By striking a single, but critical, word from ... the law governing franchise relations in Michigan, the dealers seek to force Tesla, a company that has never had a franchise dealership, into a body of law solely intended to govern the relationship between a manufacturer and its associated dealers," the company wrote. "In so doing, they create an effective prohibition against Tesla opening a store in Michigan."
The law would also prevent Tesla from opening its car gallery in Michigan, where the company shares information about its cars without conducting any sales. Tesla's vice president of business development Diarmuid O'Connell told The Detroit News that the company had no fair chance to fight the bill as the amendment was put in last-minute.
In order to defend its consumer-favored move and push direct sales of Tesla cars in the state, the car maker is asking its consumers to ask Snyder to veto the bill. Tesla is also open to a public debate in 2015 to better address the concern.
Tesla has already failed to retain direct sales license in Arizona, New Jersey, Texas and Virginia.
