Chris Christie Pulls the Plug on Tesla in NJ
It isn't easy being green... especially not in the State of New Jersey, the latest state to pull the plug on "Direct-to-Consumer Sales" of automobiles within the state. Tuesday, the NJ Motor Vehicle Commission, in a unanimous vote, prohibits companies from using a "direct-sales model" which cuts out those wheelin' and dealin', pushy car dealerships and sells to consumers direct.
Naturally, the regulation was supported by the New Jersey Coalition of Automotive Retailers, which reminds us that the state law has always required automakers to obtain franchise agreements, state licenses, and sell their vehicles through dealers.
Tesla stated on their corporate website that they were in negotiations with New Jersey Governor Chris Christie and the commission to delay the proposal that would ban the direct sales, so that it could be handled by state Legislature fairly. According to them, Christie and the MVC went out of their way and behind their backs to push the ban forward, and please a "special interest group" benefiting from the monopoly. Fearful of the competition, auto dealer lobbyists were said to be greasing more than car gears to circumvent the legislative process and push the ban on independent sales. Unfortunately for Tesla, they've been operating out of two NJ locations, selling their electric vehicles for about a year. At this point in time, unless they agree, they'll have to resell their cars though franchised dealers like GM, Ford, or Audi.
Kevin Roberts, an administration spokesman for Christie mumbled something to the effect, "This administration does not find it appropriate to unilaterally change the way cars are sold in NJ without legislation and Tesla has been aware of this in the beginning." (But they have no problem going out of their way to impede and squash it as quickly as possible to please special interest groups?) Not sure what the rush was by MVC to get the direct sales of cars banned, clearly only affecting one particular vendor in the entire State of NJ with it's own private showrooms... unfortunately, Christie has a BIG issue with free enterprise.
Tesla's reasoning for wanting to sell their own cars was quite simple... conflict of interest. Electric cars vs. gasoline powered cars... would the EV's be fairly promoted over the cheaper, higher selling, gas guzzling cars? Gasoline powered cars provide an enormous amount of revenue to dealerships through their service plans... Electric cars have no spark plugs to change, no tune ups, no oil or oil filter changes... much less maintenance... Pushing EV cars would essentially hurt thier own businesses. Tesla CEO Elon Musk argues that it's unfair to overcharge people for unneeded services - something all car owners can relate to, because we have all been taken for a ride or two by a mechanic trying to sell us a new engine and tires when we simply came in for an oil change.
Chris Christie claimed it had to do with "consumer protection" - but I'd be the first one to agree with Musk's blog rant in saying that "consumer protection" is the farthest thing from a car dealer's mind... and ANYONE and EVERYONE who's ever purchased a car from a dealership knows the song and dance and smoke and mirrors that goes with it. Lets see how long they can sit in the office and move around "magic numbers" until the same exact deal looks completely different to you because you don't realize that the discounted monthly payment offer is only due to the fact they are pushing your purchase agreement 60 months, instead of 36.
Lucky for NJ residents, Tesla ownership is only a "tri-state" away, with both Pennsylvania and New York allowing for sales statewide, while a "charged-up" Tesla Motors hopes to soon find a remedy for this. In the meantime... both New Jersey stores will be required to close shop.
What is your opinion on the MVC and Chris Christie ban on direct-to-consumer sales? What about the way they handled the matter, breaking promises to Tesla?