Michigan Governor to Sign Bill to Ban Tesla Direct Sales

[KeepItReal]

Source: Businessweek

Tesla (TSLA:US) Motors Inc. can’t open showrooms or directly sell its electric cars in Michigan under legislation that Governor Rick Snyder plans to sign that will formally block the sales method.

“This bill does not, as some have claimed, prevent auto manufacturers from selling automobiles directly to consumers at retail in Michigan -– because this is already prohibited under Michigan law,” Snyder said in a letter to lawmakers that accompanies the signed bill. He said the bill was intended to allow Tesla to sell through other automakers’ dealerships in the state.

Elon Musk, Tesla’s co-founder and chief executive officer, has said its electric cars are best sold directly by the company, rather than through franchised dealers. Tesla also operates its own showrooms, or galleries, and takes orders on the Internet. Auto dealers have said that method subverts how franchisees have sold vehicles for decades, an arrangement they say benefits consumers by ensuring local attention to their needs.

The Michigan bill prohibits any automaker from selling a vehicle “directly to a retail customer other than through franchised dealers,” with exceptions for nonprofit organizations and government agencies.

Read more: http://www.businessweek.com/news/2014-10-21/michigan-governor-to-sign-bill-to-ban-tesla-direct-sales

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Looks like the deed is already done:

Governor Rick Snyder today signed bipartisan legislation aimed at discouraging Tesla Motors from selling its electric cars directly through company stores.

House Bill 5606, sponsored by state Rep. Aric Nesbitt, also prohibits auto manufacturers from dictating fees franchised dealers can charge customers. The legislation allows individual auto dealers to make the business decision whether to charge the transaction fee.

Earlier today General Motors urged the governor to sign the bill.

Snyder, who has boasted of making Michigan more hospitable for entrepreneurs, brings Michigan into a growing number of states that have raised obstacles to the California-based electric car company.

http://www.freep.com/story/money/cars/general-motors/2014/10/17/michigan-verge-banning-tesla-stores/17386251/

Looks like Michigan went even farther to ban Tesla even having a gallery in Michigan to display cars and provide information.

[TeamPooka]

1. The Michigan Middleman Bill. nt

[Rhinodawg]

2. Rick Snyder is the worst governor EVER. I hate that guy.

POS

[still_one]

3. And for the same reason we won't have socialized medicine for a long time

Too many special interests

[dbackjon]

4. Why do they hate Free Enterprise

The no gallery rule seems illegal from the start.


And the local attention? When most auto dealerships are chains, owned by someone not local, the argument is moot.

[LonePirate]

6. I was thinking the same thing. Why does the party who champions the free market pass bills like this

Perhaps a better question would be why don't more people recognize Republicans as the lying hypocrites which they are.

[Iliyah]

24. Why do a party deny water for many in Detriot

Where is the compassion?

[Thor_MN]

27. The Right Wing will say anything to get what it wants.

They don't give a shit about most of the things they squawk about, it's just words to get people to vote for them, so they can continue shoveling tax dollars into their pockets.

[KeepItReal]

7. Yeah they are pro-business until competition rears its head

GM needs to be worrying about its endless string of vehicle recalls, and not Tesla coming in and taking some high-end pure electric vehicle sales (of which GM has zero models).

[notadmblnd]

26. They don't, for themselves. They only hate it for the other guy.

[valerief]

5. oil oil oil oil oil oil oil

[tomm2thumbs]

9. yup and money money money

[valerief]

10. In this world, they're the same thing. nt

[Jack Rabbit]

8. Fee, fi, fo. phallic/I small the shit of the Koch brothers' ALEC

To be honest, I don't know if ALEC is behind this, but the last time I read about anti-competitive legislation aimed at clean energy it was taxing homeowners for putting up solar panels, and that came just moths after reading about ALEC modeling such an obscenity.

It certainly fits the Kochs' MO.

Hey, Dave and Charlie, what's that you say about the benefits of the free market?

[RadicalGeek]

11. Or

ExxonMobil, etc.

[Jack Rabbit]

13. Same thing

ExxonMobil is a member of ALEC.

[global1]

12. Actually Tesla's Way Of Selling Is An Idea Whose Time Has Come......

It might not be catching on right now - but I think that other automakers will realize that they can probably make more money doing the same and if they are not already considering removing their middleman dealers now - I believe that they will come to that conclusion sooner or later.

I had a rude awakening yesterday when I went looking for some software to load on my computer. Software in boxes with discs does not exist in any appreciable amounts now. One has to buy what looks like a gift card and go to the internet to download it after putting in the purchase codes on the cards. That way the manufacturers don't have to lay out the money for expensive fancy packaging or diskettes and they can control how long it remains current before you might have to renew it in one year.

As you can see I haven't been to a computer store in quite some time and just discovered this yesterday.

So to will automakers discover that they can make more profit and control the situation better. Tesla is a trail blazer right now and there is a resistance out there - probably mostly from the dealers. This too shall pass.

Progress, progress, progress.

[jtuck004]

16. Just a note: Thumb drives.

For those of us who used to use the crap out of DVDs, these things are an improvement. Online storage is much better too, and takes up some of the space that disk drives used to provide, but with backups of the backup and all those things home users rarely if ever do.

If you aren't running it, I would suggest you at least take a look at Linux. I moved to that for my business and personal use some time ago, and now I just download a new one to a thumb drive, use a program like unetbootin to install it on that drive, then I can use that on any computer I wish. Plug the drive in and the OS runs from the thumb drive. From there I can install it to the hard drive if there is one.

Linux takes a little more learning if one has never used it before, but if you can get a computer that you don't mind re-installing a couple times you might want to try it. After you figure out it really is a lot like Windows, you may never go back to the "good-enough" commercial software.

Also, the only reason to upgrade is when they come out with a new version. At no cost to you. It really is quite functional, and you can find nearly any kind of software you want for little or no cost.

You will also find, or may have already, that a whole lot of computers no longer come with a disk drive, so get used to your disks going away.

Times do change, don't they

[global1]

20. Thanks For The Info.....nt

[GeorgeGist]

14. Going Backwards Again. Its the GOP way.

Soon they'll be whining that folks are going to Chicago to buy them and leaving the sales tax in Ill.


http://www.teslamotors.com/findus#/bounds/49.38,-66.94,25.82,-124.39,d?search=store,service,

[Dawson Leery]

15. This is the corporate element of fascism.

The GOP is pro-oil and anti-alternative energy.

I would buy a Tesla over anything GM (with millions upon millions of recalls) has these days.

[jtuck004]

17. Ok, so people will go next door, pay them the profit, pay them the taxes, and drive across your

roads without paying any taxes for fuel.

What an absolutely BRILLIANT plan. It's blinding - by that I mean it's hard to see any good in it.

Puts the cost of running the state on others.

[Purveyor]

18. Democrats Just Waiting To See What Gov. Snyder Decides On Tesla's Access In Michigan

---clip
So what’s the free-market governor to do?

Democrats from a crass political standpoint don’t care what he does.

Possible news release number one if he signs the bill: Given a chance to embrace entrepreneurship, which he says he loves, and given a chance to welcome the Tesla car company to the state, the governor sided with his pals at the Michigan Auto Dealers Association and told the electric car company to stay in California.

Possible news release number two if he vetoes the bill: Given a chance to protect car dealers in this state who have been fighting for their lives, Gov. Rick Snyder blew it by dusting off the welcome mat to a California car maker that does not want to play by Michigan’s rules on selling vehicles at a traditional dealership. Talk about not saying yes to Michigan.

The company complains the legislation also bans it from communicating in person with a potential buyer who might come into a building where the cars are displayed. Does the governor not endorse free speech?

For those gloating D’s over in the corner just waiting for the governor’s decision, they see it as a win-win either way.

entire article: http://www.mlive.com/lansing-news/index.ssf/2014/10/tim_skubick_democrats_are_just.html

[alarimer]

19. So Republicans DO like excessive regulation.

As long as it benefits some corporations over others, it's great.

So much for the "free market." Guess the auto giants are afraid of competition.

[turbinetree]

21. Corporate Welfare

Lets think about this for a minute.
We have a governor that appoints a "manager" in various cities in Michigan then when the public wants to buy a product he signs a law saying that you can't buy a product at a cheaper rate by direct selling, because he says so.
So we now have to subsidize who and what to get a product governor Snyder, and in the process we have here is outright censor ship in Michigan

[jmowreader]

22. Has Elon Musk ever explained the rationale behind this?

It can't be because Teslas are expensive and special - the expensiveness and specialness of a Freightliner would make Elon Musk's buyers curl up in little balls, and those are sold through franchised dealers. And it can't be because Tesla wants the car to go to the customer with the most recent software - all cars are put through a pre-delivery process, and there'd be no problem with plugging the car into a computer. The only "acceptable to a government official" reason I can see, is franchised dealers need to floorplan cars so people can take them home the day they buy them and Tesla's production volume is low enough he can't make that many cars.

Yes, yes, I know..."but Lamborghini dealers don't floorplan." This is probably true (although I haven't been to Beverly Hills, where they probably do keep a couple of red ones in stock just in case someone HAS to have a Lambo right now dammit!) but Elon Musk is in the cheap luxury car block rather than the expensive luxury car block, and cheap luxury cars like Lexus and Mercedes-Benz are floorplanned.

[whatthehey]

23. Easy. Dealers by and large hate EVs, don't understand them, don't want them

[KeepItReal]

25. Elon Musk says Tesla will never make a profit off its Service Centers

Musk:

I have made it a principle within Tesla that we should never attempt to make servicing a profit center. It does not seem right to me that companies try to make a profit off customers when their product breaks. Overcharging people for unneeded servicing (often not even fixing the original problem) is rampant within the industry...

http://www.fool.com/investing/general/2014/07/19/3-things-you-may-not-know-about-electric-car-maker.aspx

[whatthehey]

37. that certainly explains part of dealer resentment. EVs need comparatively minimal service/repair

[MindPilot]

40. True, but I don't think that's the reason

I have a '09 Ford Escape hybrid. It is 6 years old, 56,000 miles and doesn't even need tires. Since I bought it brand new, I have literally spent more on detailing than service. It has needed exactly zero repairs except for a small air conditioning problem at about 1200 miles.

So these days even gas cars don't need much work, it's not about service because FVs will still need brakes, tires, suspension & climate control system maintained, and dealers wouldn't mind that work.

This is just a back door attempt by the big three's dealers, mostly GM to squelch competition.

[MindPilot]

38. Very true. Most car dealers are finaced by their service department.

The money you spend at the dealer for repairs & parts, subsidies the sales department and warranty services. The margin on new cars is very thin.

Dealers also make a boatload on the back end of a sale, financing and insurance, known in the biz as the "F & I Kickback".

[SoapBox]

28. Uhhhh...I thought that Pukes didn't like over reaching gub'ment!

It's a jokes. Pukes don't want freedom of choice or freedom of speech or freedom of anything...

They love to tell you what they want you to do or not do.

Dictators.

[JDDavis]

29. This is unconstitutional, of course

So whatever law he signs will be struck down.

And Tesla can sue the great citizens of Michigan for electing people that voted-in candidates who supported an anti-competitive marketplace.

Sure, it will take a few years in the courts to be settled, but the Michigan taxpayers will be left holding the bill and paying for Republicans who act in such a way.

[blackspade]

30. What was that about the free market, again?

I couldn't hear them over the sound of their raging hypocrisy and corruption....

[Pharaoh]

31. under that argument

Amazon shouldn't sell books or anything else over the internet........

[KeepItReal]

32. ...Nor should Starbucks sell coffee directly to consumers

No franchisees (mostly) for SBUX.

[llmart]

33. One more reason this jerk needs to go......

All Michiganders on DU - make sure you get out and vote and toss this fake to the curb. He's been horrible for Michigan. He's starting to rival Engler.

[rafeh1]

34. its gm using dealers as a screen

GM cant handle tesla and is using lawfare to stop them

[LanternWaste]

39. Lobbying from dealership franchises rather than General Motors.

Lobbying from dealership franchises rather than General Motors. Look to TX, NC, etc. to see who and where lobbying money for this is coming from and going to.

GM doesn't care how its cards are sold as long as they are sold. The dealership franchises on the other hand...

[supercats]

35. Rick Snyder, Scott Walker, John Kascek....

All terrible, odious, so-called human beings, doing everything they can to ruin humanity and the world we live in.

[Corey_Baker08]

36. I Was Just About To Add Ohio Governor John Kasich As One Of The Worst...

but thank you for adding his name before me. I believe the only reason Kasich expanded Medicaid under the ACA, which he vehemently opposed, is due to the fact that he is up for re-election this year.

Indiana's Republican Governor Mike Pence, who in my opinion is less conservative than Kasich, however did not expand Medicaid for Hoosiers under the ACA, but again he isn't the one facing re-election...

I live on the Indiana-Ohio border so I have deep knowledge of both politics at each level of each state and to me Kasich is one of the worst Governors in the country for sure, yet I had faith that as Governor of Indiana Mike Pence who is a former congressman that actually worked with Democrats while in congress, would be the lesser of the two evil conservative Governors'. Unfortunately Pence is showing his true colors.