Michigan becomes 5th US state to thwart direct Tesla car sales
Key Excerpts from Article on Website of CNBC/Reuters
Posted: November 3rd, 2014
Michigan Governor Rick Snyder signed a bill on Tuesday that will keep electric carmaker Tesla Motors from selling its cars directly to consumers in the state, home to the biggest U.S. automakers. Snyder said in a letter to members of the state House of Representatives on Tuesday that the measure merely "clarifies" existing law not to allow direct manufacturer-to-consumer retail sales. Those sales, he said, must be made through franchised dealers. Michigan becomes the fifth U.S. state to keep Tesla from easily selling cars directly to consumers. In all of those states except Michigan, Tesla operates "galleries" where consumers can view Tesla cars but cannot discuss prices, take test drives or order cars. Michigan has gone a step further, said Diarmuid O'Connell, Tesla vice president of business development, and will not allow even the informational galleries. Tesla, which has challenged some of the long-held conventions of auto industry, wants to set up its own sleek stores rather than to sell through a franchised dealer network. The Michigan measure, passed 38-0 in the state's Senate and 106-1 in the House, does not mention Tesla by name. But, O'Connell said, the legislation clearly is addressed to the company. O'Connell said the bill was pushed through the legislature without chance for public debate because well-connected auto dealers did not want a public airing of the state's policy. Detroit-based General Motors on Tuesday said it supported the new measure.
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