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Environment

Tesla's Push to Sell Directly to Customers Moves Forward in Connecticut

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One part of the compromise is limiting the number of stores Tesla can open.

A compromise has been worked out between the state's automotive dealers and electric-vehicle manufacturer Tesla. That's according to the co-chair of the state's transportation committee. 

The debate is this: Tesla wants to sell its line of electric cars directly to customers from storefronts in Connecticut, but decades-old state dealership laws prevent that. Lobbyists for the auto dealers say allowing Tesla to sell directly could pave the way for other car manufacturers to do the same -- undercutting "mom and pop" dealerships and leaving customers holding the bag on things like repairs, if a manufacturer went out of business.

Now, a deal has been reached. Tony Guerrera, co-chair of the state's transportation committee, said one part of the compromise is limiting the number of stores Tesla can open.

"Right now, we're looking at three stores throughout the state of Connecticut," Guerrera said. "Obviously Tesla wanted more, but half of the pie is better than none of the pie."

Tesla had been requesting to open five locations. Guerrera said the proposed agreement would also be crafted to allow Tesla only to make these direct sales, and if the company starts selling a lot of cars in the state, it may embrace the dealership model.

"Connecticut is changing and it's technology is changing. I think we have to adapt to that, but in the meantime we have to be sure that we don't create a tidal wave that wipes out an industry that's been in the state here for so many years," Guerrera said. "But if we can do it in a way that minimizes their exposure, I think everyone can win with this."

The Connecticut Automotive Retailers Association, which has been at odds with Tesla over its request to sell directly, said it couldn't comment on the issue directly, but with about a month left in the legislative session, "I think we'll just have to wait and see what the committee wants to do with the issue," said James Fleming, CARA's president. "It's really up to them." 

New York currently allows direct Tesla sales, which has pushed a lot of customers (including State Sen. Art Linares) out of state for things like test drives and to the Internet for their purchases. Direct Tesla sales are allowed in about 35 states and last month, Governor Christie signed a bill allowing Tesla to sell directly to customers in New Jersey.

Guerrera said a bill will be moving to the floor of the House and he's hopeful it will be called for a vote soon. The legislative session ends on June 3.

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