Tesla is stepping up its legal battle with New Jersey
Tesla Motors is stepping up its legal battle with the state of New Jersey over its ability to sell vehicles directly to customers, rather than going through a dealership. Fresh off its victory in Massachusetts, where the state’s high court authorized the electric vehicle manufacturer’s business model of selling directly to customers, Tesla is challenging New Jersey’s assertion that Tesla’s business model will disrupt the conventional franchise model.
The New Jersey Motor Vehicle Commission altered the rules back in March that prevented Tesla’s New Jersey locations from selling vehicles to customers directly as of April 15, when the automaker’s licenses expired. After accusing the state of back room type dealings, the automaker is now appealing the state’s decision, arguing that Mew Jersey’s franchise statute doesn’t apply to Tesla because it has no franchisor-franchisee relationships.
“We believe the regulatory action was made in error,” Tesla’s VP of business development, Diarmuid O’Connell, told Automotive News in a statement. “We’ve prepared a legal action to deal with that, and I’m feeling pretty good about that.”
The briefing was filed back in March, but Tesla’s reasoning for the appeal is only just now coming to light. The automaker also claims that the commission “has limited powers and is not entitled to enforce the franchise statute anyway” and “certain elements of the rule previously have been found to violate the New Jersey Constitution. Those are requirements on minimum square footage, multiple car models on display, and on-site servicing equipment.”
Read more about the story at Automotive News.