Tesla Motors Inc (NASDAQ:TSLA) news highlights an ongoing court battle with car dealers who are fighting against the company’s push to start selling its electric vehicles in Utah.
The dealers argue that state laws do not allow vehicle manufacturers to have their own dealerships in the state. The dealers argue that the laws were set up to protect customers and they want the firm to honor the laws. Tesla, however, wants the Utah Supreme court to change the law so that it can start selling its electric cars at the $3 million showroom that it opened in Salt Lake City. The electric vehicle manufacturer also claims that it cannot sell its vehicles through traditional dealers because it has a different business model. It also claims that the model relies on encouraging the customers to purchase electric and forego the traditional vehicles.
Tesla News Reveals that dealer are more open to the idea of selling Tesla vehicles
The electric vehicle maker’s argument suggests that dealers will be conflicted as far as selling electric vehicles is concerned. The company’s argument is based on the fact that it wants to completely discourage customers from purchasing combustion engine-powered vehicles in favor of its modern technology which is also environmentally friendly. Tesla believes that dealers will not prioritize its vehicles or use a similar approach since they also want to sell the other types of vehicles.
The Utah Auto Dealers Association, however, argues that dealers are open-minded about selling Tesla vehicles in their shops. They also supported their claim, stating that they are already selling electric cars from other manufacturers.
According to Tesla news, the law preventing manufacturers from owning dealerships encourages the formation of a car dealership monopoly. This, in turn, goes against the free-market policy which the state constitution aims to uphold. It is currently not clear whether Tesla is willing to accept selling through dealerships. If the ruling goes in favor of the electric car manufacturer, other companies will most likely want to get into the mix and criticize the judicial system.